Correlation Between Centrum Finansowe and VOOLT SA
Can any of the company-specific risk be diversified away by investing in both Centrum Finansowe and VOOLT 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 Centrum Finansowe and VOOLT SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centrum Finansowe Banku and VOOLT SA, you can compare the effects of market volatilities on Centrum Finansowe and VOOLT 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 Centrum Finansowe with a short position of VOOLT SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centrum Finansowe and VOOLT SA.
Diversification Opportunities for Centrum Finansowe and VOOLT SA
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Centrum and VOOLT is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Centrum Finansowe Banku and VOOLT SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VOOLT SA and Centrum Finansowe 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 Centrum Finansowe Banku are associated (or correlated) with VOOLT SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VOOLT SA has no effect on the direction of Centrum Finansowe i.e., Centrum Finansowe and VOOLT SA go up and down completely randomly.
Pair Corralation between Centrum Finansowe and VOOLT SA
Assuming the 90 days trading horizon Centrum Finansowe Banku is expected to generate 0.61 times more return on investment than VOOLT SA. However, Centrum Finansowe Banku is 1.63 times less risky than VOOLT SA. It trades about 0.06 of its potential returns per unit of risk. VOOLT SA is currently generating about -0.04 per unit of risk. If you would invest 570.00 in Centrum Finansowe Banku on September 12, 2024 and sell it today you would earn a total of 15.00 from holding Centrum Finansowe Banku or generate 2.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centrum Finansowe Banku vs. VOOLT SA
Performance |
| Timeline |
| Centrum Finansowe Banku |
| VOOLT SA |
Centrum Finansowe and VOOLT SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centrum Finansowe and VOOLT SA
The main advantage of trading using opposite Centrum Finansowe and VOOLT SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centrum Finansowe position performs unexpectedly, VOOLT 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 VOOLT SA will offset losses from the drop in VOOLT SA's long position.| Centrum Finansowe vs. Carlson Investments SA | Centrum Finansowe vs. Asseco Business Solutions | Centrum Finansowe vs. Detalion Games SA | Centrum Finansowe vs. Asseco South Eastern |
| VOOLT SA vs. M Food SA | VOOLT SA vs. Centrum Finansowe Banku | VOOLT SA vs. Santander Bank Polska | VOOLT SA vs. Saule Technologies 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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