Correlation Between Bank Ochrony and MBank SA
Can any of the company-specific risk be diversified away by investing in both Bank Ochrony and MBank SA 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 Ochrony and MBank SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Ochrony rodowiska and mBank SA, you can compare the effects of market volatilities on Bank Ochrony and MBank SA 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 Ochrony with a short position of MBank SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Ochrony and MBank SA.
Diversification Opportunities for Bank Ochrony and MBank SA
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and MBank is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bank Ochrony rodowiska and mBank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on mBank SA and Bank Ochrony 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 Ochrony rodowiska are associated (or correlated) with MBank SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of mBank SA has no effect on the direction of Bank Ochrony i.e., Bank Ochrony and MBank SA go up and down completely randomly.
Pair Corralation between Bank Ochrony and MBank SA
Assuming the 90 days trading horizon Bank Ochrony is expected to generate 2.49 times less return on investment than MBank SA. In addition to that, Bank Ochrony is 1.08 times more volatile than mBank SA. It trades about 0.02 of its total potential returns per unit of risk. mBank SA is currently generating about 0.07 per unit of volatility. If you would invest 28,940 in mBank SA on September 2, 2024 and sell it today you would earn a total of 24,060 from holding mBank SA or generate 83.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Ochrony rodowiska vs. mBank SA
Performance |
| Timeline |
| Bank Ochrony rodowiska |
| mBank SA |
Bank Ochrony and MBank SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Ochrony and MBank SA
The main advantage of trading using opposite Bank Ochrony and MBank SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Ochrony position performs unexpectedly, MBank SA 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 MBank SA will offset losses from the drop in MBank SA's long position.| Bank Ochrony vs. Baked Games SA | Bank Ochrony vs. ING Bank lski | Bank Ochrony vs. BNP Paribas Bank | Bank Ochrony vs. TEN SQUARE GAMES |
| MBank SA vs. Movie Games SA | MBank SA vs. 3R Games SA | MBank SA vs. Gamedust SA | MBank SA vs. Intersport Polska 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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