Correlation Between Sydbank and Zegona Communications
Can any of the company-specific risk be diversified away by investing in both Sydbank and Zegona Communications 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 Sydbank and Zegona Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sydbank and Zegona Communications Plc, you can compare the effects of market volatilities on Sydbank and Zegona Communications 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 Sydbank with a short position of Zegona Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sydbank and Zegona Communications.
Diversification Opportunities for Sydbank and Zegona Communications
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sydbank and Zegona is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Sydbank and Zegona Communications Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zegona Communications Plc and Sydbank 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 Sydbank are associated (or correlated) with Zegona Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zegona Communications Plc has no effect on the direction of Sydbank i.e., Sydbank and Zegona Communications go up and down completely randomly.
Pair Corralation between Sydbank and Zegona Communications
Assuming the 90 days trading horizon Sydbank is expected to generate 0.95 times more return on investment than Zegona Communications. However, Sydbank is 1.05 times less risky than Zegona Communications. It trades about 0.18 of its potential returns per unit of risk. Zegona Communications Plc is currently generating about 0.02 per unit of risk. If you would invest 33,069 in Sydbank on August 27, 2024 and sell it today you would earn a total of 2,191 from holding Sydbank or generate 6.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sydbank vs. Zegona Communications Plc
Performance |
| Timeline |
| Sydbank |
| Zegona Communications Plc |
Sydbank and Zegona Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sydbank and Zegona Communications
The main advantage of trading using opposite Sydbank and Zegona Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sydbank position performs unexpectedly, Zegona Communications 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 Zegona Communications will offset losses from the drop in Zegona Communications' long position.| Sydbank vs. Tyson Foods Cl | Sydbank vs. Batm Advanced Communications | Sydbank vs. GlobalData PLC | Sydbank vs. Universal Display Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |