Correlation Between Access Power and Magyar Telekom
Can any of the company-specific risk be diversified away by investing in both Access Power and Magyar Telekom 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 Access Power and Magyar Telekom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Access Power Co and Magyar Telekom Plc, you can compare the effects of market volatilities on Access Power and Magyar Telekom 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 Access Power with a short position of Magyar Telekom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Access Power and Magyar Telekom.
Diversification Opportunities for Access Power and Magyar Telekom
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Access and Magyar is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Access Power Co and Magyar Telekom Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magyar Telekom Plc and Access Power 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 Access Power Co are associated (or correlated) with Magyar Telekom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magyar Telekom Plc has no effect on the direction of Access Power i.e., Access Power and Magyar Telekom go up and down completely randomly.
Pair Corralation between Access Power and Magyar Telekom
Given the investment horizon of 90 days Access Power Co is expected to generate 15.93 times more return on investment than Magyar Telekom. However, Access Power is 15.93 times more volatile than Magyar Telekom Plc. It trades about 0.11 of its potential returns per unit of risk. Magyar Telekom Plc is currently generating about 0.14 per unit of risk. If you would invest 0.18 in Access Power Co on November 3, 2024 and sell it today you would lose (0.01) from holding Access Power Co or give up 5.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Access Power Co vs. Magyar Telekom Plc
Performance |
| Timeline |
| Access Power |
| Magyar Telekom Plc |
Access Power and Magyar Telekom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Access Power and Magyar Telekom
The main advantage of trading using opposite Access Power and Magyar Telekom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Access Power position performs unexpectedly, Magyar Telekom 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 Magyar Telekom will offset losses from the drop in Magyar Telekom's long position.| Access Power vs. BCE Inc | Access Power vs. Axiologix | Access Power vs. Advanced Info Service | Access Power vs. American Nortel Communications |
| Magyar Telekom vs. SwissCom AG | Magyar Telekom vs. Hellenic Telecommunications Org | Magyar Telekom vs. Telefonica SA ADR | Magyar Telekom vs. Lumen Technologies |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |