Correlation Between Sumitomo Mitsui and Komercní Banka
Can any of the company-specific risk be diversified away by investing in both Sumitomo Mitsui and Komercní Banka 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 Sumitomo Mitsui and Komercní Banka into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumitomo Mitsui Construction and Komercn banka as, you can compare the effects of market volatilities on Sumitomo Mitsui and Komercní Banka 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 Sumitomo Mitsui with a short position of Komercní Banka. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumitomo Mitsui and Komercní Banka.
Diversification Opportunities for Sumitomo Mitsui and Komercní Banka
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sumitomo and Komercní is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Sumitomo Mitsui Construction and Komercn banka as in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Komercn banka as and Sumitomo Mitsui 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 Sumitomo Mitsui Construction are associated (or correlated) with Komercní Banka. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Komercn banka as has no effect on the direction of Sumitomo Mitsui i.e., Sumitomo Mitsui and Komercní Banka go up and down completely randomly.
Pair Corralation between Sumitomo Mitsui and Komercní Banka
Assuming the 90 days horizon Sumitomo Mitsui Construction is expected to under-perform the Komercní Banka. But the stock apears to be less risky and, when comparing its historical volatility, Sumitomo Mitsui Construction is 1.12 times less risky than Komercní Banka. The stock trades about -0.23 of its potential returns per unit of risk. The Komercn banka as is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,392 in Komercn banka as on October 20, 2024 and sell it today you would earn a total of 68.00 from holding Komercn banka as or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sumitomo Mitsui Construction vs. Komercn banka as
Performance |
| Timeline |
| Sumitomo Mitsui Cons |
| Komercn banka as |
Sumitomo Mitsui and Komercní Banka Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumitomo Mitsui and Komercní Banka
The main advantage of trading using opposite Sumitomo Mitsui and Komercní Banka positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumitomo Mitsui position performs unexpectedly, Komercní Banka 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 Komercní Banka will offset losses from the drop in Komercní Banka's long position.| Sumitomo Mitsui vs. Datang International Power | Sumitomo Mitsui vs. CN DATANG C | Sumitomo Mitsui vs. SEI INVESTMENTS | Sumitomo Mitsui vs. Pure Storage |
| Komercní Banka vs. Sumitomo Mitsui Construction | Komercní Banka vs. CREO MEDICAL GRP | Komercní Banka vs. Diamyd Medical AB | Komercní Banka vs. Federal Agricultural Mortgage |
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.
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