Correlation Between Bank of Ireland Group PLC and SL Private
Can any of the company-specific risk be diversified away by investing in both Bank of Ireland Group PLC and SL Private 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 of Ireland Group PLC and SL Private into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of Ireland and SL Private Equity, you can compare the effects of market volatilities on Bank of Ireland Group PLC and SL Private 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 of Ireland Group PLC with a short position of SL Private. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Ireland Group PLC and SL Private.
Diversification Opportunities for Bank of Ireland Group PLC and SL Private
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and SLPE is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Ireland and SL Private Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SL Private Equity and Bank of Ireland Group PLC 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 of Ireland are associated (or correlated) with SL Private. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SL Private Equity has no effect on the direction of Bank of Ireland Group PLC i.e., Bank of Ireland Group PLC and SL Private go up and down completely randomly.
Pair Corralation between Bank of Ireland Group PLC and SL Private
Assuming the 90 days trading horizon Bank of Ireland is expected to generate 2.82 times more return on investment than SL Private. However, Bank of Ireland Group PLC is 2.82 times more volatile than SL Private Equity. It trades about 0.39 of its potential returns per unit of risk. SL Private Equity is currently generating about 0.05 per unit of risk. If you would invest 964.00 in Bank of Ireland on November 29, 2024 and sell it today you would earn a total of 159.00 from holding Bank of Ireland or generate 16.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Ireland vs. SL Private Equity
Performance |
| Timeline |
| Bank of Ireland Group PLC |
| SL Private Equity |
Bank of Ireland Group PLC and SL Private Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Ireland Group PLC and SL Private
The main advantage of trading using opposite Bank of Ireland Group PLC and SL Private positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Ireland Group PLC position performs unexpectedly, SL Private 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 SL Private will offset losses from the drop in SL Private's long position.| Bank of Ireland Group PLC vs. Norman Broadbent Plc | Bank of Ireland Group PLC vs. Jacquet Metal Service | Bank of Ireland Group PLC vs. Silvercorp Metals | Bank of Ireland Group PLC vs. JB Hunt Transport |
| SL Private vs. Metals Exploration Plc | SL Private vs. Samsung Electronics Co | SL Private vs. International Biotechnology Trust | SL Private vs. Cornish Metals |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |