Correlation Between PICKN PAY and SAP SE

Can any of the company-specific risk be diversified away by investing in both PICKN PAY and SAP SE 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 PICKN PAY and SAP SE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PICKN PAY STORES and SAP SE, you can compare the effects of market volatilities on PICKN PAY and SAP SE 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 PICKN PAY with a short position of SAP SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PICKN PAY and SAP SE.

Diversification Opportunities for PICKN PAY and SAP SE

0.18

Correlation Coefficient

PICKN PAY  SAP SE

Average diversification

The 3 months correlation between PICKN and SAP is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding PICKN PAY STORES and SAP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE and PICKN PAY 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 PICKN PAY STORES are associated (or correlated) with SAP SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE has no effect on the direction of PICKN PAY i.e., PICKN PAY and SAP SE go up and down completely randomly.

Pair Corralation between PICKN PAY and SAP SE

Assuming the 90 days trading horizon PICKN PAY is expected to generate 7.85 times less return on investment than SAP SE. In addition to that, PICKN PAY is 1.12 times more volatile than SAP SE. It trades about 0.02 of its total potential returns per unit of risk. SAP SE is currently generating about 0.15 per unit of volatility. If you would invest  21,812  in SAP SE on April 21, 2025 and sell it today you would earn a total of  4,388  from holding SAP SE or generate 20.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

PICKN PAY STORES  vs.  SAP SE

PICKN PAY STORES

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in PICKN PAY STORES are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, PICKN PAY is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

SAP SE

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SAP SE are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SAP SE reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PICKN PAY and SAP SE

The main advantage of trading using opposite PICKN PAY and SAP SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PICKN PAY position performs unexpectedly, SAP SE 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 SAP SE will offset losses from the drop in SAP SE's long position.

The idea behind PICKN PAY STORES and SAP SE 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.