Correlation Between Este Lauder and Addiko Bank
Can any of the company-specific risk be diversified away by investing in both Este Lauder and Addiko 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 Este Lauder and Addiko Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Este Lauder and Addiko Bank AG, you can compare the effects of market volatilities on Este Lauder and Addiko 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 Este Lauder with a short position of Addiko Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Este Lauder and Addiko Bank.
Diversification Opportunities for Este Lauder and Addiko Bank
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Este and Addiko is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding The Este Lauder and Addiko Bank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Addiko Bank AG and Este Lauder 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 The Este Lauder are associated (or correlated) with Addiko Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Addiko Bank AG has no effect on the direction of Este Lauder i.e., Este Lauder and Addiko Bank go up and down completely randomly.
Pair Corralation between Este Lauder and Addiko Bank
Assuming the 90 days trading horizon The Este Lauder is expected to under-perform the Addiko Bank. In addition to that, Este Lauder is 4.3 times more volatile than Addiko Bank AG. It trades about -0.25 of its total potential returns per unit of risk. Addiko Bank AG is currently generating about -0.08 per unit of volatility. If you would invest 2,020 in Addiko Bank AG on August 23, 2024 and sell it today you would lose (40.00) from holding Addiko Bank AG or give up 1.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Este Lauder vs. Addiko Bank AG
Performance |
| Timeline |
| Este Lauder |
| Addiko Bank AG |
Este Lauder and Addiko Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Este Lauder and Addiko Bank
The main advantage of trading using opposite Este Lauder and Addiko Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Este Lauder position performs unexpectedly, Addiko 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 Addiko Bank will offset losses from the drop in Addiko Bank's long position.| Este Lauder vs. UNIQA Insurance Group | Este Lauder vs. CNH Industrial NV | Este Lauder vs. Erste Group Bank | Este Lauder vs. Universal Music Group |
| Addiko Bank vs. BKS Bank AG | Addiko Bank vs. Vienna Insurance Group | Addiko Bank vs. AMAG Austria Metall | Addiko Bank vs. Universal Music Group |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |