Correlation Between Komercn Banka and Socit Gnrale
Can any of the company-specific risk be diversified away by investing in both Komercn Banka and Socit Gnrale 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 Komercn Banka and Socit Gnrale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Komercn banka as and Socit Gnrale Socit, you can compare the effects of market volatilities on Komercn Banka and Socit Gnrale 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 Komercn Banka with a short position of Socit Gnrale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Komercn Banka and Socit Gnrale.
Diversification Opportunities for Komercn Banka and Socit Gnrale
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Komercn and Socit is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Komercn banka as and Socit Gnrale Socit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socit Gnrale Socit and Komercn 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 Komercn banka as are associated (or correlated) with Socit Gnrale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socit Gnrale Socit has no effect on the direction of Komercn Banka i.e., Komercn Banka and Socit Gnrale go up and down completely randomly.
Pair Corralation between Komercn Banka and Socit Gnrale
Assuming the 90 days trading horizon Komercn Banka is expected to generate 24.35 times less return on investment than Socit Gnrale. But when comparing it to its historical volatility, Komercn banka as is 2.42 times less risky than Socit Gnrale. It trades about 0.01 of its potential returns per unit of risk. Socit Gnrale Socit is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,384 in Socit Gnrale Socit on August 29, 2024 and sell it today you would earn a total of 71.00 from holding Socit Gnrale Socit or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Komercn banka as vs. Socit Gnrale Socit
Performance |
| Timeline |
| Komercn banka as |
| Socit Gnrale Socit |
Komercn Banka and Socit Gnrale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Komercn Banka and Socit Gnrale
The main advantage of trading using opposite Komercn Banka and Socit Gnrale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Komercn Banka position performs unexpectedly, Socit Gnrale 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 Socit Gnrale will offset losses from the drop in Socit Gnrale's long position.The idea behind Komercn banka as and Socit Gnrale Socit 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.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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |