Correlation Between Bank Handlowy and UniCredit SpA
Can any of the company-specific risk be diversified away by investing in both Bank Handlowy and UniCredit SpA 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 Bank Handlowy and UniCredit SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Handlowy w and UniCredit SpA, you can compare the effects of market volatilities on Bank Handlowy and UniCredit SpA 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 Bank Handlowy with a short position of UniCredit SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Handlowy and UniCredit SpA.
Diversification Opportunities for Bank Handlowy and UniCredit SpA
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and UniCredit is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Bank Handlowy w and UniCredit SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UniCredit SpA and Bank Handlowy 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 Bank Handlowy w are associated (or correlated) with UniCredit SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UniCredit SpA has no effect on the direction of Bank Handlowy i.e., Bank Handlowy and UniCredit SpA go up and down completely randomly.
Pair Corralation between Bank Handlowy and UniCredit SpA
Assuming the 90 days trading horizon Bank Handlowy w is expected to under-perform the UniCredit SpA. But the stock apears to be less risky and, when comparing its historical volatility, Bank Handlowy w is 1.96 times less risky than UniCredit SpA. The stock trades about -0.11 of its potential returns per unit of risk. The UniCredit SpA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 16,998 in UniCredit SpA on August 24, 2024 and sell it today you would earn a total of 162.00 from holding UniCredit SpA or generate 0.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
Bank Handlowy w vs. UniCredit SpA
Performance |
| Timeline |
| Bank Handlowy w |
| UniCredit SpA |
Bank Handlowy and UniCredit SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Handlowy and UniCredit SpA
The main advantage of trading using opposite Bank Handlowy and UniCredit SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Handlowy position performs unexpectedly, UniCredit SpA 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 UniCredit SpA will offset losses from the drop in UniCredit SpA's long position.| Bank Handlowy vs. Pixel Crow Games | Bank Handlowy vs. Ultimate Games SA | Bank Handlowy vs. Medicofarma Biotech SA | Bank Handlowy vs. Gamedust SA |
| UniCredit SpA vs. Detalion Games SA | UniCredit SpA vs. TEN SQUARE GAMES | UniCredit SpA vs. PLAYWAY SA | UniCredit SpA vs. Gamedust SA |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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