Correlation Between Bank of Queensland and Platinum Asset
Can any of the company-specific risk be diversified away by investing in both Bank of Queensland and Platinum Asset 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 Platinum Asset 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 Platinum Asset Management, you can compare the effects of market volatilities on Bank of Queensland and Platinum Asset 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 Platinum Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Queensland and Platinum Asset.
Diversification Opportunities for Bank of Queensland and Platinum Asset
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and Platinum is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Queensland and Platinum Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Asset Management 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 Platinum Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Asset Management has no effect on the direction of Bank of Queensland i.e., Bank of Queensland and Platinum Asset go up and down completely randomly.
Pair Corralation between Bank of Queensland and Platinum Asset
Assuming the 90 days trading horizon Bank of Queensland is expected to generate 0.14 times more return on investment than Platinum Asset. However, Bank of Queensland is 7.06 times less risky than Platinum Asset. It trades about 0.07 of its potential returns per unit of risk. Platinum Asset Management is currently generating about -0.04 per unit of risk. If you would invest 9,234 in Bank of Queensland on November 2, 2024 and sell it today you would earn a total of 1,226 from holding Bank of Queensland or generate 13.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Bank of Queensland vs. Platinum Asset Management
Performance |
Timeline |
Bank of Queensland |
Platinum Asset Management |
Bank of Queensland and Platinum Asset Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank of Queensland and Platinum Asset
The main advantage of trading using opposite Bank of Queensland and Platinum Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Queensland position performs unexpectedly, Platinum Asset 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 Platinum Asset will offset losses from the drop in Platinum Asset's long position.Bank of Queensland vs. Carlton Investments | Bank of Queensland vs. Sandon Capital Investments | Bank of Queensland vs. Mirrabooka Investments | Bank of Queensland vs. Computershare |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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