Correlation Between Halyk Bank and Capricorn Energy
Can any of the company-specific risk be diversified away by investing in both Halyk Bank and Capricorn Energy 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 Halyk Bank and Capricorn Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Halyk Bank of and Capricorn Energy PLC, you can compare the effects of market volatilities on Halyk Bank and Capricorn Energy 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 Halyk Bank with a short position of Capricorn Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Halyk Bank and Capricorn Energy.
Diversification Opportunities for Halyk Bank and Capricorn Energy
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Halyk and Capricorn is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Halyk Bank of and Capricorn Energy PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capricorn Energy PLC and Halyk Bank 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 Halyk Bank of are associated (or correlated) with Capricorn Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capricorn Energy PLC has no effect on the direction of Halyk Bank i.e., Halyk Bank and Capricorn Energy go up and down completely randomly.
Pair Corralation between Halyk Bank and Capricorn Energy
Assuming the 90 days trading horizon Halyk Bank of is expected to generate 0.45 times more return on investment than Capricorn Energy. However, Halyk Bank of is 2.21 times less risky than Capricorn Energy. It trades about 0.13 of its potential returns per unit of risk. Capricorn Energy PLC is currently generating about -0.01 per unit of risk. If you would invest 785.00 in Halyk Bank of on November 2, 2024 and sell it today you would earn a total of 1,145 from holding Halyk Bank of or generate 145.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Halyk Bank of vs. Capricorn Energy PLC
Performance |
| Timeline |
| Halyk Bank |
| Capricorn Energy PLC |
Halyk Bank and Capricorn Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Halyk Bank and Capricorn Energy
The main advantage of trading using opposite Halyk Bank and Capricorn Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Halyk Bank position performs unexpectedly, Capricorn Energy 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 Capricorn Energy will offset losses from the drop in Capricorn Energy's long position.The idea behind Halyk Bank of and Capricorn Energy PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Capricorn Energy vs. Datalogic | Capricorn Energy vs. JB Hunt Transport | Capricorn Energy vs. Pets at Home | Capricorn Energy vs. Wizz Air Holdings |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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