Correlation Between ALTEO Energiaszolgalta and OTP Bank
Can any of the company-specific risk be diversified away by investing in both ALTEO Energiaszolgalta and OTP Bank 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 ALTEO Energiaszolgalta and OTP Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALTEO Energiaszolgaltato Nyrt and OTP Bank Nyrt, you can compare the effects of market volatilities on ALTEO Energiaszolgalta and OTP Bank 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 ALTEO Energiaszolgalta with a short position of OTP Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALTEO Energiaszolgalta and OTP Bank.
Diversification Opportunities for ALTEO Energiaszolgalta and OTP Bank
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ALTEO and OTP is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding ALTEO Energiaszolgaltato Nyrt and OTP Bank Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OTP Bank Nyrt and ALTEO Energiaszolgalta 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 ALTEO Energiaszolgaltato Nyrt are associated (or correlated) with OTP Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OTP Bank Nyrt has no effect on the direction of ALTEO Energiaszolgalta i.e., ALTEO Energiaszolgalta and OTP Bank go up and down completely randomly.
Pair Corralation between ALTEO Energiaszolgalta and OTP Bank
Assuming the 90 days trading horizon ALTEO Energiaszolgaltato Nyrt is expected to under-perform the OTP Bank. But the stock apears to be less risky and, when comparing its historical volatility, ALTEO Energiaszolgaltato Nyrt is 1.63 times less risky than OTP Bank. The stock trades about -0.08 of its potential returns per unit of risk. The OTP Bank Nyrt is currently generating about 0.48 of returns per unit of risk over similar time horizon. If you would invest 1,870,000 in OTP Bank Nyrt on August 24, 2024 and sell it today you would earn a total of 290,000 from holding OTP Bank Nyrt or generate 15.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALTEO Energiaszolgaltato Nyrt vs. OTP Bank Nyrt
Performance |
| Timeline |
| ALTEO Energiaszolgalta |
| OTP Bank Nyrt |
ALTEO Energiaszolgalta and OTP Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALTEO Energiaszolgalta and OTP Bank
The main advantage of trading using opposite ALTEO Energiaszolgalta and OTP Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALTEO Energiaszolgalta position performs unexpectedly, OTP Bank 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 OTP Bank will offset losses from the drop in OTP Bank's long position.| ALTEO Energiaszolgalta vs. OPUS GLOBAL Nyrt | ALTEO Energiaszolgalta vs. OTP Bank Nyrt | ALTEO Energiaszolgalta vs. Infineon Technologies AG | ALTEO Energiaszolgalta vs. Appeninn Nyrt |
| OTP Bank vs. OPUS GLOBAL Nyrt | OTP Bank vs. Infineon Technologies AG | OTP Bank vs. Appeninn Nyrt | OTP Bank vs. MOL Nyrt |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |