Correlation Between Noble Financials and Asseco Poland
Can any of the company-specific risk be diversified away by investing in both Noble Financials and Asseco Poland 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 Noble Financials and Asseco Poland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Noble Financials SA and Asseco Poland SA, you can compare the effects of market volatilities on Noble Financials and Asseco Poland 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 Noble Financials with a short position of Asseco Poland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Noble Financials and Asseco Poland.
Diversification Opportunities for Noble Financials and Asseco Poland
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Noble and Asseco is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Noble Financials SA and Asseco Poland SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asseco Poland SA and Noble Financials 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 Noble Financials SA are associated (or correlated) with Asseco Poland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asseco Poland SA has no effect on the direction of Noble Financials i.e., Noble Financials and Asseco Poland go up and down completely randomly.
Pair Corralation between Noble Financials and Asseco Poland
Assuming the 90 days trading horizon Noble Financials SA is expected to generate 3.18 times more return on investment than Asseco Poland. However, Noble Financials is 3.18 times more volatile than Asseco Poland SA. It trades about -0.04 of its potential returns per unit of risk. Asseco Poland SA is currently generating about -0.22 per unit of risk. If you would invest 9,040 in Noble Financials SA on August 25, 2024 and sell it today you would lose (420.00) from holding Noble Financials SA or give up 4.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Noble Financials SA vs. Asseco Poland SA
Performance |
| Timeline |
| Noble Financials |
| Asseco Poland SA |
Noble Financials and Asseco Poland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Noble Financials and Asseco Poland
The main advantage of trading using opposite Noble Financials and Asseco Poland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Noble Financials position performs unexpectedly, Asseco Poland 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 Asseco Poland will offset losses from the drop in Asseco Poland's long position.| Noble Financials vs. Ultimate Games SA | Noble Financials vs. Santander Bank Polska | Noble Financials vs. Centrum Finansowe Banku | Noble Financials vs. Detalion Games SA |
| Asseco Poland vs. Mlk Foods Public | Asseco Poland vs. MCI Management SA | Asseco Poland vs. Noble Financials SA | Asseco Poland vs. X Trade Brokers |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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