Correlation Between Bank of Queensland and Mystate
Can any of the company-specific risk be diversified away by investing in both Bank of Queensland and Mystate 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 Queensland and Mystate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of Queensland and Mystate, you can compare the effects of market volatilities on Bank of Queensland and Mystate 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 Queensland with a short position of Mystate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Queensland and Mystate.
Diversification Opportunities for Bank of Queensland and Mystate
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Mystate is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Queensland and Mystate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mystate and Bank of Queensland 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 Queensland are associated (or correlated) with Mystate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mystate has no effect on the direction of Bank of Queensland i.e., Bank of Queensland and Mystate go up and down completely randomly.
Pair Corralation between Bank of Queensland and Mystate
Assuming the 90 days trading horizon Bank of Queensland is expected to under-perform the Mystate. But the stock apears to be less risky and, when comparing its historical volatility, Bank of Queensland is 6.0 times less risky than Mystate. The stock trades about -0.01 of its potential returns per unit of risk. The Mystate is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 389.00 in Mystate on August 28, 2024 and sell it today you would earn a total of 17.00 from holding Mystate or generate 4.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Queensland vs. Mystate
Performance |
| Timeline |
| Bank of Queensland |
| Mystate |
Bank of Queensland and Mystate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Queensland and Mystate
The main advantage of trading using opposite Bank of Queensland and Mystate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Queensland position performs unexpectedly, Mystate 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 Mystate will offset losses from the drop in Mystate's long position.| Bank of Queensland vs. Mystate | Bank of Queensland vs. Insurance Australia Group | Bank of Queensland vs. Origin Energy | Bank of Queensland vs. Ecofibre |
| Mystate vs. Aneka Tambang Tbk | Mystate vs. BHP Group Limited | Mystate vs. Commonwealth Bank of | Mystate vs. Commonwealth Bank of |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |