Correlation Between Pagaya Technologies and BlackBerry

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

By analyzing existing cross correlation between Pagaya Technologies Ltd and BlackBerry, you can compare the effects of market volatilities on Pagaya Technologies and BlackBerry 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 Pagaya Technologies with a short position of BlackBerry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pagaya Technologies and BlackBerry.

Diversification Opportunities for Pagaya Technologies and BlackBerry

0.09

Correlation Coefficient

Pagaya Technologies  BlackBerry

Significant diversification

The 3 months correlation between Pagaya and BlackBerry is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Pagaya Technologies Ltd and BlackBerry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlackBerry and Pagaya Technologies 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 Pagaya Technologies Ltd are associated (or correlated) with BlackBerry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlackBerry has no effect on the direction of Pagaya Technologies i.e., Pagaya Technologies and BlackBerry go up and down completely randomly.

Pair Corralation between Pagaya Technologies and BlackBerry

If you would invest  270.00  in BlackBerry on January 31, 2024 and sell it today you would earn a total of  16.00  from holding BlackBerry or generate 5.93% return on investment over 90 days.

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

Pagaya Technologies Ltd  vs.  BlackBerry

Pagaya Technologies

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Pagaya Technologies Ltd are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Pagaya Technologies may actually be approaching a critical reversion point that can send shares even higher in May 2024.

BlackBerry

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BlackBerry are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating fundamental drivers, BlackBerry may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with Pagaya Technologies and BlackBerry

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

The idea behind Pagaya Technologies Ltd and BlackBerry 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.