Correlation Between CPI Computer and Optima Bank
Can any of the company-specific risk be diversified away by investing in both CPI Computer and Optima Bank 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 CPI Computer and Optima Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Computer Peripherals and Optima bank SA, you can compare the effects of market volatilities on CPI Computer and Optima Bank 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 CPI Computer with a short position of Optima Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Computer and Optima Bank.
Diversification Opportunities for CPI Computer and Optima Bank
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between CPI and Optima is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding CPI Computer Peripherals and Optima bank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optima bank SA and CPI Computer 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 CPI Computer Peripherals are associated (or correlated) with Optima Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optima bank SA has no effect on the direction of CPI Computer i.e., CPI Computer and Optima Bank go up and down completely randomly.
Pair Corralation between CPI Computer and Optima Bank
Assuming the 90 days trading horizon CPI Computer is expected to generate 22.88 times less return on investment than Optima Bank. In addition to that, CPI Computer is 2.08 times more volatile than Optima bank SA. It trades about 0.0 of its total potential returns per unit of risk. Optima bank SA is currently generating about 0.15 per unit of volatility. If you would invest 696.00 in Optima bank SA on August 28, 2024 and sell it today you would earn a total of 606.00 from holding Optima bank SA or generate 87.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 58.76% |
| Values | Daily Returns |
CPI Computer Peripherals vs. Optima bank SA
Performance |
| Timeline |
| CPI Computer Peripherals |
| Optima bank SA |
CPI Computer and Optima Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Computer and Optima Bank
The main advantage of trading using opposite CPI Computer and Optima Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Computer position performs unexpectedly, Optima Bank 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 Optima Bank will offset losses from the drop in Optima Bank's long position.| CPI Computer vs. Performance Technologies SA | CPI Computer vs. National Bank of | CPI Computer vs. EL D Mouzakis | CPI Computer vs. Lampsa Hellenic Hotels |
| Optima Bank vs. Coca Cola HBC AG | Optima Bank vs. Hellenic Telecommunications Organization | Optima Bank vs. Greek Organization of | Optima Bank vs. Eurobank Ergasias Services |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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