Correlation Between EQT AB and Bank of New York Mellon
Can any of the company-specific risk be diversified away by investing in both EQT AB and Bank of New York Mellon 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 EQT AB and Bank of New York Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EQT AB and The Bank of, you can compare the effects of market volatilities on EQT AB and Bank of New York Mellon 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 EQT AB with a short position of Bank of New York Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of EQT AB and Bank of New York Mellon.
Diversification Opportunities for EQT AB and Bank of New York Mellon
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EQT and Bank is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding EQT AB and The Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of New York Mellon and EQT AB 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 EQT AB are associated (or correlated) with Bank of New York Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of New York Mellon has no effect on the direction of EQT AB i.e., EQT AB and Bank of New York Mellon go up and down completely randomly.
Pair Corralation between EQT AB and Bank of New York Mellon
Assuming the 90 days horizon EQT AB is expected to under-perform the Bank of New York Mellon. In addition to that, EQT AB is 1.29 times more volatile than The Bank of. It trades about -0.14 of its total potential returns per unit of risk. The Bank of is currently generating about 0.26 per unit of volatility. If you would invest 7,022 in The Bank of on August 27, 2024 and sell it today you would earn a total of 644.00 from holding The Bank of or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EQT AB vs. The Bank of
Performance |
| Timeline |
| EQT AB |
| Bank of New York Mellon |
EQT AB and Bank of New York Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EQT AB and Bank of New York Mellon
The main advantage of trading using opposite EQT AB and Bank of New York Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EQT AB position performs unexpectedly, Bank of New York Mellon 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 Bank of New York Mellon will offset losses from the drop in Bank of New York Mellon's long position.| EQT AB vs. The Bank of | EQT AB vs. Superior Plus Corp | EQT AB vs. NMI Holdings | EQT AB vs. Origin Agritech |
| Bank of New York Mellon vs. NTG Nordic Transport | Bank of New York Mellon vs. SLR Investment Corp | Bank of New York Mellon vs. Apollo Investment Corp | Bank of New York Mellon vs. REINET INVESTMENTS SCA |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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