Correlation Between MT Bank and Abrdn European
Can any of the company-specific risk be diversified away by investing in both MT Bank and Abrdn European 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 MT Bank and Abrdn European into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MT Bank Corp and abrdn European Logistics, you can compare the effects of market volatilities on MT Bank and Abrdn European 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 MT Bank with a short position of Abrdn European. Check out your portfolio center. Please also check ongoing floating volatility patterns of MT Bank and Abrdn European.
Diversification Opportunities for MT Bank and Abrdn European
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 0JW2 and Abrdn is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding MT Bank Corp and abrdn European Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn European Logistics and MT Bank 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 MT Bank Corp are associated (or correlated) with Abrdn European. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn European Logistics has no effect on the direction of MT Bank i.e., MT Bank and Abrdn European go up and down completely randomly.
Pair Corralation between MT Bank and Abrdn European
Assuming the 90 days trading horizon MT Bank Corp is expected to under-perform the Abrdn European. But the stock apears to be less risky and, when comparing its historical volatility, MT Bank Corp is 1.01 times less risky than Abrdn European. The stock trades about -0.22 of its potential returns per unit of risk. The abrdn European Logistics is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 5,696 in abrdn European Logistics on September 13, 2024 and sell it today you would earn a total of 204.00 from holding abrdn European Logistics or generate 3.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
MT Bank Corp vs. abrdn European Logistics
Performance |
| Timeline |
| MT Bank Corp |
| abrdn European Logistics |
MT Bank and Abrdn European Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MT Bank and Abrdn European
The main advantage of trading using opposite MT Bank and Abrdn European positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MT Bank position performs unexpectedly, Abrdn European 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 Abrdn European will offset losses from the drop in Abrdn European's long position.| MT Bank vs. Charter Communications Cl | MT Bank vs. Schweiter Technologies AG | MT Bank vs. Gamma Communications PLC | MT Bank vs. Albion Technology General |
| Abrdn European vs. Catalyst Media Group | Abrdn European vs. CATLIN GROUP | Abrdn European vs. Tamburi Investment Partners | Abrdn European vs. Magnora ASA |
Check out your portfolio center.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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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