Correlation Between Postal Savings and WIMFARM SA
Can any of the company-specific risk be diversified away by investing in both Postal Savings and WIMFARM SA 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 Postal Savings and WIMFARM SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Savings Bank and WIMFARM SA EO, you can compare the effects of market volatilities on Postal Savings and WIMFARM SA 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 Postal Savings with a short position of WIMFARM SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Savings and WIMFARM SA.
Diversification Opportunities for Postal Savings and WIMFARM SA
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Postal and WIMFARM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Postal Savings Bank and WIMFARM SA EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WIMFARM SA EO and Postal Savings 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 Postal Savings Bank are associated (or correlated) with WIMFARM SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WIMFARM SA EO has no effect on the direction of Postal Savings i.e., Postal Savings and WIMFARM SA go up and down completely randomly.
Pair Corralation between Postal Savings and WIMFARM SA
Assuming the 90 days horizon Postal Savings Bank is expected to generate 1.49 times more return on investment than WIMFARM SA. However, Postal Savings is 1.49 times more volatile than WIMFARM SA EO. It trades about -0.03 of its potential returns per unit of risk. WIMFARM SA EO is currently generating about -0.41 per unit of risk. If you would invest 55.00 in Postal Savings Bank on August 25, 2024 and sell it today you would lose (1.00) from holding Postal Savings Bank or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Savings Bank vs. WIMFARM SA EO
Performance |
| Timeline |
| Postal Savings Bank |
| WIMFARM SA EO |
Postal Savings and WIMFARM SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Savings and WIMFARM SA
The main advantage of trading using opposite Postal Savings and WIMFARM SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Savings position performs unexpectedly, WIMFARM SA 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 WIMFARM SA will offset losses from the drop in WIMFARM SA's long position.| Postal Savings vs. Deutsche Bank Aktiengesellschaft | Postal Savings vs. Superior Plus Corp | Postal Savings vs. NMI Holdings | Postal Savings vs. Origin Agritech |
| WIMFARM SA vs. AB Volvo | WIMFARM SA vs. Superior Plus Corp | WIMFARM SA vs. NMI Holdings | WIMFARM SA vs. Origin Agritech |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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