Correlation Between PSQ Holdings and Satori Resources

Can any of the company-specific risk be diversified away by investing in both PSQ Holdings and Satori Resources at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PSQ Holdings and Satori Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PSQ Holdings and Satori Resources, you can compare the effects of market volatilities on PSQ Holdings and Satori Resources and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PSQ Holdings with a short position of Satori Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of PSQ Holdings and Satori Resources.

Diversification Opportunities for PSQ Holdings and Satori Resources

-0.41

Correlation Coefficient

PSQ Holdings  Satori Resources

Very good diversification

The 3 months correlation between PSQ and Satori is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding PSQ Holdings and Satori Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satori Resources and PSQ Holdings is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PSQ Holdings are associated (or correlated) with Satori Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satori Resources has no effect on the direction of PSQ Holdings i.e., PSQ Holdings and Satori Resources go up and down completely randomly.

Pair Corralation between PSQ Holdings and Satori Resources

Given the investment horizon of 90 days PSQ Holdings is expected to generate 8.93 times more return on investment than Satori Resources. However, PSQ Holdings is 8.93 times more volatile than Satori Resources. It trades about 0.09 of its potential returns per unit of risk. Satori Resources is currently generating about -0.08 per unit of risk. If you would invest  246.00  in PSQ Holdings on September 23, 2024 and sell it today you would earn a total of  138.00  from holding PSQ Holdings or generate 56.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

PSQ Holdings  vs.  Satori Resources

PSQ Holdings

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PSQ Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, PSQ Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Satori Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Satori Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with PSQ Holdings and Satori Resources

The main advantage of trading using opposite PSQ Holdings and Satori Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PSQ Holdings position performs unexpectedly, Satori Resources can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Satori Resources will offset losses from the drop in Satori Resources' long position.

The idea behind PSQ Holdings and Satori Resources pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.