Correlation Between Alior Bank and Movie Games
Can any of the company-specific risk be diversified away by investing in both Alior Bank and Movie Games 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 Alior Bank and Movie Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alior Bank SA and Movie Games SA, you can compare the effects of market volatilities on Alior Bank and Movie Games 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 Alior Bank with a short position of Movie Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alior Bank and Movie Games.
Diversification Opportunities for Alior Bank and Movie Games
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alior and Movie is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Alior Bank SA and Movie Games SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Movie Games SA and Alior Bank 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 Alior Bank SA are associated (or correlated) with Movie Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Movie Games SA has no effect on the direction of Alior Bank i.e., Alior Bank and Movie Games go up and down completely randomly.
Pair Corralation between Alior Bank and Movie Games
Assuming the 90 days trading horizon Alior Bank SA is expected to under-perform the Movie Games. In addition to that, Alior Bank is 3.43 times more volatile than Movie Games SA. It trades about -0.06 of its total potential returns per unit of risk. Movie Games SA is currently generating about -0.2 per unit of volatility. If you would invest 1,862 in Movie Games SA on August 24, 2024 and sell it today you would lose (66.00) from holding Movie Games SA or give up 3.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Alior Bank SA vs. Movie Games SA
Performance |
| Timeline |
| Alior Bank SA |
| Movie Games SA |
Alior Bank and Movie Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alior Bank and Movie Games
The main advantage of trading using opposite Alior Bank and Movie Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alior Bank position performs unexpectedly, Movie Games 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 Movie Games will offset losses from the drop in Movie Games' long position.| Alior Bank vs. Banco Santander SA | Alior Bank vs. Asseco Business Solutions | Alior Bank vs. Detalion Games SA | Alior Bank vs. Asseco South Eastern |
| Movie Games vs. CD PROJEKT SA | Movie Games vs. PLAYWAY SA | Movie Games vs. 11 bit studios | Movie Games vs. TEN SQUARE GAMES |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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