Correlation Between Coreshares Index and ABSA Bank
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By analyzing existing cross correlation between Coreshares Index Tracker and ABSA Bank Limited, you can compare the effects of market volatilities on Coreshares Index and ABSA 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 Coreshares Index with a short position of ABSA Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coreshares Index and ABSA Bank.
Diversification Opportunities for Coreshares Index and ABSA Bank
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Coreshares and ABSA is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Coreshares Index Tracker and ABSA Bank Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABSA Bank Limited and Coreshares Index 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 Coreshares Index Tracker are associated (or correlated) with ABSA Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABSA Bank Limited has no effect on the direction of Coreshares Index i.e., Coreshares Index and ABSA Bank go up and down completely randomly.
Pair Corralation between Coreshares Index and ABSA Bank
Assuming the 90 days trading horizon Coreshares Index Tracker is expected to under-perform the ABSA Bank. In addition to that, Coreshares Index is 1.44 times more volatile than ABSA Bank Limited. It trades about -0.05 of its total potential returns per unit of risk. ABSA Bank Limited is currently generating about 0.1 per unit of volatility. If you would invest 8,540,000 in ABSA Bank Limited on August 30, 2024 and sell it today you would earn a total of 110,000 from holding ABSA Bank Limited or generate 1.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coreshares Index Tracker vs. ABSA Bank Limited
Performance |
| Timeline |
| Coreshares Index Tracker |
| ABSA Bank Limited |
Coreshares Index and ABSA Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coreshares Index and ABSA Bank
The main advantage of trading using opposite Coreshares Index and ABSA Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coreshares Index position performs unexpectedly, ABSA 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 ABSA Bank will offset losses from the drop in ABSA Bank's long position.| Coreshares Index vs. CoreShares Preference Share | Coreshares Index vs. CoreShares TotalWldStock ETF | Coreshares Index vs. CoreShares SP 500 | Coreshares Index vs. CoreShares Income AMETF |
| ABSA Bank vs. Kap Industrial Holdings | ABSA Bank vs. Bytes Technology | ABSA Bank vs. Frontier Transport Holdings | ABSA Bank vs. Lesaka 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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