Correlation Between JSC Halyk and REINET INVESTMENTS
Can any of the company-specific risk be diversified away by investing in both JSC Halyk and REINET INVESTMENTS 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 JSC Halyk and REINET INVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JSC Halyk bank and REINET INVESTMENTS SCA, you can compare the effects of market volatilities on JSC Halyk and REINET INVESTMENTS 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 JSC Halyk with a short position of REINET INVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of JSC Halyk and REINET INVESTMENTS.
Diversification Opportunities for JSC Halyk and REINET INVESTMENTS
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JSC and REINET is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding JSC Halyk bank and REINET INVESTMENTS SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REINET INVESTMENTS SCA and JSC Halyk 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 JSC Halyk bank are associated (or correlated) with REINET INVESTMENTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REINET INVESTMENTS SCA has no effect on the direction of JSC Halyk i.e., JSC Halyk and REINET INVESTMENTS go up and down completely randomly.
Pair Corralation between JSC Halyk and REINET INVESTMENTS
Assuming the 90 days trading horizon JSC Halyk bank is expected to generate 2.93 times more return on investment than REINET INVESTMENTS. However, JSC Halyk is 2.93 times more volatile than REINET INVESTMENTS SCA. It trades about 0.08 of its potential returns per unit of risk. REINET INVESTMENTS SCA is currently generating about -0.02 per unit of risk. If you would invest 1,710 in JSC Halyk bank on September 1, 2024 and sell it today you would earn a total of 90.00 from holding JSC Halyk bank or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JSC Halyk bank vs. REINET INVESTMENTS SCA
Performance |
| Timeline |
| JSC Halyk bank |
| REINET INVESTMENTS SCA |
JSC Halyk and REINET INVESTMENTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JSC Halyk and REINET INVESTMENTS
The main advantage of trading using opposite JSC Halyk and REINET INVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JSC Halyk position performs unexpectedly, REINET INVESTMENTS 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 REINET INVESTMENTS will offset losses from the drop in REINET INVESTMENTS's long position.| JSC Halyk vs. Automatic Data Processing | JSC Halyk vs. Cass Information Systems | JSC Halyk vs. TELES Informationstechnologien AG | JSC Halyk vs. Hyrican Informationssysteme Aktiengesellschaft |
| REINET INVESTMENTS vs. LG Display Co | REINET INVESTMENTS vs. ETFS Coffee ETC | REINET INVESTMENTS vs. Luckin Coffee | REINET INVESTMENTS vs. Madison Square Garden |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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