Correlation Between Cez AS and SAB Finance
Can any of the company-specific risk be diversified away by investing in both Cez AS and SAB Finance 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 Cez AS and SAB Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cez AS and SAB Finance as, you can compare the effects of market volatilities on Cez AS and SAB Finance 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 Cez AS with a short position of SAB Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cez AS and SAB Finance.
Diversification Opportunities for Cez AS and SAB Finance
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cez and SAB is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Cez AS and SAB Finance as in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAB Finance as and Cez AS 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 Cez AS are associated (or correlated) with SAB Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAB Finance as has no effect on the direction of Cez AS i.e., Cez AS and SAB Finance go up and down completely randomly.
Pair Corralation between Cez AS and SAB Finance
Assuming the 90 days trading horizon Cez AS is expected to generate 1.51 times more return on investment than SAB Finance. However, Cez AS is 1.51 times more volatile than SAB Finance as. It trades about 0.09 of its potential returns per unit of risk. SAB Finance as is currently generating about 0.0 per unit of risk. If you would invest 99,700 in Cez AS on November 18, 2024 and sell it today you would earn a total of 2,600 from holding Cez AS or generate 2.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cez AS vs. SAB Finance as
Performance |
| Timeline |
| Cez AS |
| SAB Finance as |
Cez AS and SAB Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cez AS and SAB Finance
The main advantage of trading using opposite Cez AS and SAB Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cez AS position performs unexpectedly, SAB Finance 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 SAB Finance will offset losses from the drop in SAB Finance's long position.| Cez AS vs. Komercni Banka AS | Cez AS vs. Moneta Money Bank | Cez AS vs. Erste Group Bank | Cez AS vs. Colt CZ Group |
| SAB Finance vs. Vienna Insurance Group | SAB Finance vs. Komercni Banka AS | SAB Finance vs. UNIQA Insurance Group | SAB Finance vs. JT ARCH INVESTMENTS |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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