Correlation Between MBank SA and Dino Polska
Can any of the company-specific risk be diversified away by investing in both MBank SA and Dino Polska 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 Dino Polska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between mBank SA and Dino Polska SA, you can compare the effects of market volatilities on MBank SA and Dino Polska 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 Dino Polska. Check out your portfolio center. Please also check ongoing floating volatility patterns of MBank SA and Dino Polska.
Diversification Opportunities for MBank SA and Dino Polska
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MBank and Dino is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding mBank SA and Dino Polska SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dino Polska 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 Dino Polska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dino Polska SA has no effect on the direction of MBank SA i.e., MBank SA and Dino Polska go up and down completely randomly.
Pair Corralation between MBank SA and Dino Polska
Assuming the 90 days trading horizon mBank SA is expected to under-perform the Dino Polska. But the stock apears to be less risky and, when comparing its historical volatility, mBank SA is 1.3 times less risky than Dino Polska. The stock trades about -0.12 of its potential returns per unit of risk. The Dino Polska SA is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 31,670 in Dino Polska SA on September 3, 2024 and sell it today you would earn a total of 6,920 from holding Dino Polska SA or generate 21.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
mBank SA vs. Dino Polska SA
Performance |
| Timeline |
| mBank SA |
| Dino Polska SA |
MBank SA and Dino Polska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MBank SA and Dino Polska
The main advantage of trading using opposite MBank SA and Dino Polska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MBank SA position performs unexpectedly, Dino Polska 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 Dino Polska will offset losses from the drop in Dino Polska's long position.| MBank SA vs. UniCredit SpA | MBank SA vs. Santander Bank Polska | MBank SA vs. Bank Polska Kasa | MBank SA vs. Bank Handlowy w |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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