Correlation Between CEZ As and Dino Polska
Can any of the company-specific risk be diversified away by investing in both CEZ As and Dino Polska 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 Dino Polska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEZ as and Dino Polska SA, you can compare the effects of market volatilities on CEZ As and Dino Polska 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 Dino Polska. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEZ As and Dino Polska.
Diversification Opportunities for CEZ As and Dino Polska
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CEZ and Dino is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding CEZ as and Dino Polska SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dino Polska SA 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 Dino Polska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dino Polska SA has no effect on the direction of CEZ As i.e., CEZ As and Dino Polska go up and down completely randomly.
Pair Corralation between CEZ As and Dino Polska
Assuming the 90 days trading horizon CEZ as is expected to generate 0.69 times more return on investment than Dino Polska. However, CEZ as is 1.45 times less risky than Dino Polska. It trades about 0.01 of its potential returns per unit of risk. Dino Polska SA is currently generating about -0.01 per unit of risk. If you would invest 16,329 in CEZ as on August 28, 2024 and sell it today you would earn a total of 301.00 from holding CEZ as or generate 1.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CEZ as vs. Dino Polska SA
Performance |
| Timeline |
| CEZ as |
| Dino Polska SA |
CEZ As and Dino Polska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEZ As and Dino Polska
The main advantage of trading using opposite CEZ As and Dino Polska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEZ As position performs unexpectedly, Dino Polska 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 Dino Polska will offset losses from the drop in Dino Polska's long position.The idea behind CEZ as and Dino Polska SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Dino Polska vs. SOFTWARE MANSION SPOLKA | Dino Polska vs. Ice Code Games | Dino Polska vs. Enter Air SA | Dino Polska vs. GreenX 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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