Correlation Between Komercni Banka and Prabos Plus
Can any of the company-specific risk be diversified away by investing in both Komercni Banka and Prabos Plus 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 Komercni Banka and Prabos Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Komercni Banka AS and Prabos Plus as, you can compare the effects of market volatilities on Komercni Banka and Prabos Plus 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 Komercni Banka with a short position of Prabos Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Komercni Banka and Prabos Plus.
Diversification Opportunities for Komercni Banka and Prabos Plus
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Komercni and Prabos is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Komercni Banka AS and Prabos Plus as in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prabos Plus as and Komercni Banka 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 Komercni Banka AS are associated (or correlated) with Prabos Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prabos Plus as has no effect on the direction of Komercni Banka i.e., Komercni Banka and Prabos Plus go up and down completely randomly.
Pair Corralation between Komercni Banka and Prabos Plus
Assuming the 90 days trading horizon Komercni Banka is expected to generate 1.02 times less return on investment than Prabos Plus. But when comparing it to its historical volatility, Komercni Banka AS is 2.17 times less risky than Prabos Plus. It trades about 0.09 of its potential returns per unit of risk. Prabos Plus as is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 21,000 in Prabos Plus as on August 31, 2024 and sell it today you would earn a total of 5,800 from holding Prabos Plus as or generate 27.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Komercni Banka AS vs. Prabos Plus as
Performance |
| Timeline |
| Komercni Banka AS |
| Prabos Plus as |
Komercni Banka and Prabos Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Komercni Banka and Prabos Plus
The main advantage of trading using opposite Komercni Banka and Prabos Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Komercni Banka position performs unexpectedly, Prabos Plus 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 Prabos Plus will offset losses from the drop in Prabos Plus' long position.| Komercni Banka vs. Cez AS | Komercni Banka vs. Moneta Money Bank | Komercni Banka vs. Erste Group Bank | Komercni Banka vs. Philip Morris CR |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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