Correlation Between Bank Millennium and Dom Development
Can any of the company-specific risk be diversified away by investing in both Bank Millennium and Dom Development 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 Bank Millennium and Dom Development into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Millennium SA and Dom Development SA, you can compare the effects of market volatilities on Bank Millennium and Dom Development 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 Bank Millennium with a short position of Dom Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Millennium and Dom Development.
Diversification Opportunities for Bank Millennium and Dom Development
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Dom is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bank Millennium SA and Dom Development SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dom Development SA and Bank Millennium 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 Bank Millennium SA are associated (or correlated) with Dom Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dom Development SA has no effect on the direction of Bank Millennium i.e., Bank Millennium and Dom Development go up and down completely randomly.
Pair Corralation between Bank Millennium and Dom Development
Assuming the 90 days trading horizon Bank Millennium is expected to generate 1.33 times less return on investment than Dom Development. In addition to that, Bank Millennium is 1.32 times more volatile than Dom Development SA. It trades about 0.06 of its total potential returns per unit of risk. Dom Development SA is currently generating about 0.11 per unit of volatility. If you would invest 7,708 in Dom Development SA on September 3, 2024 and sell it today you would earn a total of 11,992 from holding Dom Development SA or generate 155.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Millennium SA vs. Dom Development SA
Performance |
| Timeline |
| Bank Millennium SA |
| Dom Development SA |
Bank Millennium and Dom Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Millennium and Dom Development
The main advantage of trading using opposite Bank Millennium and Dom Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Millennium position performs unexpectedly, Dom Development 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 Dom Development will offset losses from the drop in Dom Development's long position.| Bank Millennium vs. UniCredit SpA | Bank Millennium vs. Santander Bank Polska | Bank Millennium vs. Bank Polska Kasa | Bank Millennium vs. ING Bank lski |
| Dom Development vs. Alior Bank SA | Dom Development vs. Saule Technologies SA | Dom Development vs. SOFTWARE MANSION SPOLKA | Dom Development vs. New Tech Venture |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |