Correlation Between Kofola CeskoSlovensko and Komercni Banka
Can any of the company-specific risk be diversified away by investing in both Kofola CeskoSlovensko and Komercni Banka 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 Kofola CeskoSlovensko and Komercni Banka into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kofola CeskoSlovensko as and Komercni Banka AS, you can compare the effects of market volatilities on Kofola CeskoSlovensko and Komercni Banka 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 Kofola CeskoSlovensko with a short position of Komercni Banka. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kofola CeskoSlovensko and Komercni Banka.
Diversification Opportunities for Kofola CeskoSlovensko and Komercni Banka
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kofola and Komercni is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Kofola CeskoSlovensko as and Komercni Banka AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Komercni Banka AS and Kofola CeskoSlovensko 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 Kofola CeskoSlovensko as are associated (or correlated) with Komercni Banka. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Komercni Banka AS has no effect on the direction of Kofola CeskoSlovensko i.e., Kofola CeskoSlovensko and Komercni Banka go up and down completely randomly.
Pair Corralation between Kofola CeskoSlovensko and Komercni Banka
Assuming the 90 days trading horizon Kofola CeskoSlovensko as is expected to generate 1.88 times more return on investment than Komercni Banka. However, Kofola CeskoSlovensko is 1.88 times more volatile than Komercni Banka AS. It trades about 0.5 of its potential returns per unit of risk. Komercni Banka AS is currently generating about -0.07 per unit of risk. If you would invest 33,600 in Kofola CeskoSlovensko as on August 28, 2024 and sell it today you would earn a total of 4,600 from holding Kofola CeskoSlovensko as or generate 13.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kofola CeskoSlovensko as vs. Komercni Banka AS
Performance |
| Timeline |
| Kofola CeskoSlovensko |
| Komercni Banka AS |
Kofola CeskoSlovensko and Komercni Banka Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kofola CeskoSlovensko and Komercni Banka
The main advantage of trading using opposite Kofola CeskoSlovensko and Komercni Banka positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kofola CeskoSlovensko position performs unexpectedly, Komercni Banka 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 Komercni Banka will offset losses from the drop in Komercni Banka's long position.| Kofola CeskoSlovensko vs. Moneta Money Bank | Kofola CeskoSlovensko vs. Komercni Banka AS | Kofola CeskoSlovensko vs. Cez AS | Kofola CeskoSlovensko vs. Erste Group Bank |
| Komercni Banka vs. Cez AS | Komercni Banka vs. Kofola CeskoSlovensko as | Komercni Banka vs. MT 1997 AS | Komercni Banka vs. HARDWARIO as |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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