Correlation Between MBank SA and Benefit Systems
Can any of the company-specific risk be diversified away by investing in both MBank SA and Benefit Systems 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 MBank SA and Benefit Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between mBank SA and Benefit Systems SA, you can compare the effects of market volatilities on MBank SA and Benefit Systems 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 MBank SA with a short position of Benefit Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of MBank SA and Benefit Systems.
Diversification Opportunities for MBank SA and Benefit Systems
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MBank and Benefit is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding mBank SA and Benefit Systems SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benefit Systems SA and MBank SA 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 mBank SA are associated (or correlated) with Benefit Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benefit Systems SA has no effect on the direction of MBank SA i.e., MBank SA and Benefit Systems go up and down completely randomly.
Pair Corralation between MBank SA and Benefit Systems
Assuming the 90 days trading horizon mBank SA is expected to under-perform the Benefit Systems. But the stock apears to be less risky and, when comparing its historical volatility, mBank SA is 1.08 times less risky than Benefit Systems. The stock trades about -0.09 of its potential returns per unit of risk. The Benefit Systems SA is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 240,000 in Benefit Systems SA on September 13, 2024 and sell it today you would earn a total of 48,500 from holding Benefit Systems SA or generate 20.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
mBank SA vs. Benefit Systems SA
Performance |
| Timeline |
| mBank SA |
| Benefit Systems SA |
MBank SA and Benefit Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MBank SA and Benefit Systems
The main advantage of trading using opposite MBank SA and Benefit Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MBank SA position performs unexpectedly, Benefit Systems 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 Benefit Systems will offset losses from the drop in Benefit Systems' long position.| MBank SA vs. UniCredit SpA | MBank SA vs. Santander Bank Polska | MBank SA vs. Bank Polska Kasa | MBank SA vs. ING Bank lski |
| Benefit Systems vs. Bank Millennium SA | Benefit Systems vs. PZ Cormay SA | Benefit Systems vs. ING Bank lski | Benefit Systems vs. Echo Investment SA |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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