Correlation Between Hrvatska Postanska and Atlantic Grupa
Can any of the company-specific risk be diversified away by investing in both Hrvatska Postanska and Atlantic Grupa 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 Hrvatska Postanska and Atlantic Grupa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hrvatska Postanska Banka and Atlantic Grupa dd, you can compare the effects of market volatilities on Hrvatska Postanska and Atlantic Grupa 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 Hrvatska Postanska with a short position of Atlantic Grupa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hrvatska Postanska and Atlantic Grupa.
Diversification Opportunities for Hrvatska Postanska and Atlantic Grupa
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hrvatska and Atlantic is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Hrvatska Postanska Banka and Atlantic Grupa dd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic Grupa dd and Hrvatska Postanska 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 Hrvatska Postanska Banka are associated (or correlated) with Atlantic Grupa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic Grupa dd has no effect on the direction of Hrvatska Postanska i.e., Hrvatska Postanska and Atlantic Grupa go up and down completely randomly.
Pair Corralation between Hrvatska Postanska and Atlantic Grupa
Assuming the 90 days trading horizon Hrvatska Postanska Banka is expected to generate 1.83 times more return on investment than Atlantic Grupa. However, Hrvatska Postanska is 1.83 times more volatile than Atlantic Grupa dd. It trades about 0.47 of its potential returns per unit of risk. Atlantic Grupa dd is currently generating about -0.05 per unit of risk. If you would invest 29,200 in Hrvatska Postanska Banka on September 14, 2024 and sell it today you would earn a total of 5,200 from holding Hrvatska Postanska Banka or generate 17.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Hrvatska Postanska Banka vs. Atlantic Grupa dd
Performance |
| Timeline |
| Hrvatska Postanska Banka |
| Atlantic Grupa dd |
Hrvatska Postanska and Atlantic Grupa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hrvatska Postanska and Atlantic Grupa
The main advantage of trading using opposite Hrvatska Postanska and Atlantic Grupa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hrvatska Postanska position performs unexpectedly, Atlantic Grupa 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 Atlantic Grupa will offset losses from the drop in Atlantic Grupa's long position.| Hrvatska Postanska vs. Zagrebacka Banka dd | Hrvatska Postanska vs. AD Plastik dd | Hrvatska Postanska vs. Dalekovod dd | Hrvatska Postanska vs. Podravka Prehrambena Industrija |
| Atlantic Grupa vs. AD Plastik dd | Atlantic Grupa vs. Hrvatska Postanska Banka | Atlantic Grupa vs. Dalekovod dd | Atlantic Grupa vs. Podravka Prehrambena Industrija |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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