Correlation Between ING Bank and Varsav Game
Can any of the company-specific risk be diversified away by investing in both ING Bank and Varsav Game 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 Varsav Game 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 Varsav Game Studios, you can compare the effects of market volatilities on ING Bank and Varsav Game 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 Varsav Game. Check out your portfolio center. Please also check ongoing floating volatility patterns of ING Bank and Varsav Game.
Diversification Opportunities for ING Bank and Varsav Game
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ING and Varsav is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding ING Bank lski and Varsav Game Studios in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Varsav Game Studios 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 Varsav Game. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Varsav Game Studios has no effect on the direction of ING Bank i.e., ING Bank and Varsav Game go up and down completely randomly.
Pair Corralation between ING Bank and Varsav Game
Assuming the 90 days trading horizon ING Bank lski is expected to generate 0.45 times more return on investment than Varsav Game. However, ING Bank lski is 2.25 times less risky than Varsav Game. It trades about 0.06 of its potential returns per unit of risk. Varsav Game Studios is currently generating about -0.01 per unit of risk. If you would invest 15,389 in ING Bank lski on August 27, 2024 and sell it today you would earn a total of 9,111 from holding ING Bank lski or generate 59.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 93.16% |
| Values | Daily Returns |
ING Bank lski vs. Varsav Game Studios
Performance |
| Timeline |
| ING Bank lski |
| Varsav Game Studios |
ING Bank and Varsav Game Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ING Bank and Varsav Game
The main advantage of trading using opposite ING Bank and Varsav Game positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ING Bank position performs unexpectedly, Varsav Game 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 Varsav Game will offset losses from the drop in Varsav Game's long position.The idea behind ING Bank lski and Varsav Game Studios 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.| Varsav Game vs. Banco Santander SA | Varsav Game vs. UniCredit SpA | Varsav Game vs. CEZ as | Varsav Game 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |