Correlation Between Komercni Banka and RMS Mezzanine
Can any of the company-specific risk be diversified away by investing in both Komercni Banka and RMS Mezzanine 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 RMS Mezzanine 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 RMS Mezzanine AS, you can compare the effects of market volatilities on Komercni Banka and RMS Mezzanine 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 RMS Mezzanine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Komercni Banka and RMS Mezzanine.
Diversification Opportunities for Komercni Banka and RMS Mezzanine
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Komercni and RMS is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Komercni Banka AS and RMS Mezzanine AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RMS Mezzanine 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 RMS Mezzanine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RMS Mezzanine AS has no effect on the direction of Komercni Banka i.e., Komercni Banka and RMS Mezzanine go up and down completely randomly.
Pair Corralation between Komercni Banka and RMS Mezzanine
Assuming the 90 days trading horizon Komercni Banka is expected to generate 5.89 times less return on investment than RMS Mezzanine. But when comparing it to its historical volatility, Komercni Banka AS is 11.62 times less risky than RMS Mezzanine. It trades about 0.09 of its potential returns per unit of risk. RMS Mezzanine AS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 180.00 in RMS Mezzanine AS on August 31, 2024 and sell it today you would lose (13.00) from holding RMS Mezzanine AS or give up 7.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Komercni Banka AS vs. RMS Mezzanine AS
Performance |
| Timeline |
| Komercni Banka AS |
| RMS Mezzanine AS |
Komercni Banka and RMS Mezzanine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Komercni Banka and RMS Mezzanine
The main advantage of trading using opposite Komercni Banka and RMS Mezzanine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Komercni Banka position performs unexpectedly, RMS Mezzanine 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 RMS Mezzanine will offset losses from the drop in RMS Mezzanine's 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 |
| RMS Mezzanine vs. Moneta Money Bank | RMS Mezzanine vs. Vienna Insurance Group | RMS Mezzanine vs. Komercni Banka AS | RMS Mezzanine vs. UNIQA Insurance Group |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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