Correlation Between CEZ As and Kino Polska
Can any of the company-specific risk be diversified away by investing in both CEZ As and Kino 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 Kino 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 Kino Polska TV, you can compare the effects of market volatilities on CEZ As and Kino 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 Kino Polska. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEZ As and Kino Polska.
Diversification Opportunities for CEZ As and Kino Polska
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CEZ and Kino is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding CEZ as and Kino Polska TV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kino Polska TV 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 Kino Polska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kino Polska TV has no effect on the direction of CEZ As i.e., CEZ As and Kino Polska go up and down completely randomly.
Pair Corralation between CEZ As and Kino Polska
Assuming the 90 days trading horizon CEZ As is expected to generate 2.44 times less return on investment than Kino Polska. In addition to that, CEZ As is 1.23 times more volatile than Kino Polska TV. It trades about 0.1 of its total potential returns per unit of risk. Kino Polska TV is currently generating about 0.3 per unit of volatility. If you would invest 1,760 in Kino Polska TV on September 2, 2024 and sell it today you would earn a total of 235.00 from holding Kino Polska TV or generate 13.35% 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. Kino Polska TV
Performance |
| Timeline |
| CEZ as |
| Kino Polska TV |
CEZ As and Kino Polska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEZ As and Kino Polska
The main advantage of trading using opposite CEZ As and Kino Polska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEZ As position performs unexpectedly, Kino 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 Kino Polska will offset losses from the drop in Kino Polska's long position.| CEZ As vs. Asseco Business Solutions | CEZ As vs. Detalion Games SA | CEZ As vs. Asseco South Eastern | CEZ As vs. CFI Holding SA |
| Kino Polska vs. Banco Santander SA | Kino Polska vs. UniCredit SpA | Kino Polska vs. CEZ as | Kino Polska vs. Polski Koncern Naftowy |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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