Correlation Between ING Bank and Triton Development
Can any of the company-specific risk be diversified away by investing in both ING Bank and Triton Development 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 ING Bank and Triton Development into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ING Bank lski and Triton Development SA, you can compare the effects of market volatilities on ING Bank and Triton Development 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 ING Bank with a short position of Triton Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of ING Bank and Triton Development.
Diversification Opportunities for ING Bank and Triton Development
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ING and Triton is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding ING Bank lski and Triton Development SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triton Development and ING 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 ING Bank lski are associated (or correlated) with Triton Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triton Development has no effect on the direction of ING Bank i.e., ING Bank and Triton Development go up and down completely randomly.
Pair Corralation between ING Bank and Triton Development
Assuming the 90 days trading horizon ING Bank lski is expected to generate 0.65 times more return on investment than Triton Development. However, ING Bank lski is 1.55 times less risky than Triton Development. It trades about 0.27 of its potential returns per unit of risk. Triton Development SA is currently generating about 0.12 per unit of risk. If you would invest 24,300 in ING Bank lski on October 20, 2024 and sell it today you would earn a total of 2,200 from holding ING Bank lski or generate 9.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
ING Bank lski vs. Triton Development SA
Performance |
| Timeline |
| ING Bank lski |
| Triton Development |
ING Bank and Triton Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ING Bank and Triton Development
The main advantage of trading using opposite ING Bank and Triton Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ING Bank position performs unexpectedly, Triton Development 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 Triton Development will offset losses from the drop in Triton Development's long position.| ING Bank vs. Creotech Instruments SA | ING Bank vs. Movie Games SA | ING Bank vs. Marie Brizard Wine | ING Bank vs. Medicofarma Biotech SA |
| Triton Development vs. Banco Santander SA | Triton Development vs. UniCredit SpA | Triton Development vs. CEZ as | Triton Development vs. Polski Koncern Naftowy |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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