Correlation Between Immobile and MBank SA
Can any of the company-specific risk be diversified away by investing in both Immobile and MBank 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 Immobile and MBank SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Immobile and mBank SA, you can compare the effects of market volatilities on Immobile and MBank 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 Immobile with a short position of MBank SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Immobile and MBank SA.
Diversification Opportunities for Immobile and MBank SA
Poor diversification
The 3 months correlation between Immobile and MBank is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Immobile and mBank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on mBank SA and Immobile 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 Immobile are associated (or correlated) with MBank SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of mBank SA has no effect on the direction of Immobile i.e., Immobile and MBank SA go up and down completely randomly.
Pair Corralation between Immobile and MBank SA
Assuming the 90 days trading horizon Immobile is expected to generate 1.07 times less return on investment than MBank SA. In addition to that, Immobile is 1.49 times more volatile than mBank SA. It trades about 0.31 of its total potential returns per unit of risk. mBank SA is currently generating about 0.48 per unit of volatility. If you would invest 60,420 in mBank SA on November 29, 2024 and sell it today you would earn a total of 15,340 from holding mBank SA or generate 25.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Immobile vs. mBank SA
Performance |
| Timeline |
| Immobile |
| mBank SA |
Immobile and MBank SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Immobile and MBank SA
The main advantage of trading using opposite Immobile and MBank SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Immobile position performs unexpectedly, MBank 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 MBank SA will offset losses from the drop in MBank SA's long position.| Immobile vs. GreenX Metals | Immobile vs. Investment Friends Capital | Immobile vs. Datawalk SA | Immobile vs. PLAYWAY SA |
| MBank SA vs. Echo Investment SA | MBank SA vs. Alior Bank SA | MBank SA vs. Investment Friends Capital | MBank SA vs. VR Factory Games |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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