Correlation Between Baker Hughes and OTP Bank
Can any of the company-specific risk be diversified away by investing in both Baker Hughes and OTP Bank 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 Baker Hughes and OTP Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baker Hughes Co and OTP Bank Nyrt, you can compare the effects of market volatilities on Baker Hughes and OTP Bank 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 Baker Hughes with a short position of OTP Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baker Hughes and OTP Bank.
Diversification Opportunities for Baker Hughes and OTP Bank
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Baker and OTP is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Baker Hughes Co and OTP Bank Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OTP Bank Nyrt and Baker Hughes 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 Baker Hughes Co are associated (or correlated) with OTP Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OTP Bank Nyrt has no effect on the direction of Baker Hughes i.e., Baker Hughes and OTP Bank go up and down completely randomly.
Pair Corralation between Baker Hughes and OTP Bank
If you would invest 1,259,000 in OTP Bank Nyrt on September 23, 2024 and sell it today you would earn a total of 0.00 from holding OTP Bank Nyrt or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baker Hughes Co vs. OTP Bank Nyrt
Performance |
| Timeline |
| Baker Hughes |
| OTP Bank Nyrt |
Baker Hughes and OTP Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baker Hughes and OTP Bank
The main advantage of trading using opposite Baker Hughes and OTP Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baker Hughes position performs unexpectedly, OTP Bank 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 OTP Bank will offset losses from the drop in OTP Bank's long position.| Baker Hughes vs. Southern Copper Corp | Baker Hughes vs. Endeavour Mining Corp | Baker Hughes vs. Metals Exploration Plc | Baker Hughes vs. AMG Advanced Metallurgical |
| OTP Bank vs. Hilton Food Group | OTP Bank vs. Veolia Environnement VE | OTP Bank vs. Charter Communications Cl | OTP Bank vs. Ironveld Plc |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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