Correlation Between NordTelekom Telecommunicatio and CIG Pannonia
Can any of the company-specific risk be diversified away by investing in both NordTelekom Telecommunicatio and CIG Pannonia 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 NordTelekom Telecommunicatio and CIG Pannonia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NordTelekom Telecommunications Service and CIG Pannonia Life, you can compare the effects of market volatilities on NordTelekom Telecommunicatio and CIG Pannonia 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 NordTelekom Telecommunicatio with a short position of CIG Pannonia. Check out your portfolio center. Please also check ongoing floating volatility patterns of NordTelekom Telecommunicatio and CIG Pannonia.
Diversification Opportunities for NordTelekom Telecommunicatio and CIG Pannonia
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NordTelekom and CIG is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding NordTelekom Telecommunications and CIG Pannonia Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIG Pannonia Life and NordTelekom Telecommunicatio 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 NordTelekom Telecommunications Service are associated (or correlated) with CIG Pannonia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIG Pannonia Life has no effect on the direction of NordTelekom Telecommunicatio i.e., NordTelekom Telecommunicatio and CIG Pannonia go up and down completely randomly.
Pair Corralation between NordTelekom Telecommunicatio and CIG Pannonia
Assuming the 90 days trading horizon NordTelekom Telecommunications Service is expected to under-perform the CIG Pannonia. In addition to that, NordTelekom Telecommunicatio is 2.33 times more volatile than CIG Pannonia Life. It trades about -0.01 of its total potential returns per unit of risk. CIG Pannonia Life is currently generating about 0.06 per unit of volatility. If you would invest 29,400 in CIG Pannonia Life on August 25, 2024 and sell it today you would earn a total of 5,700 from holding CIG Pannonia Life or generate 19.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.27% |
| Values | Daily Returns |
NordTelekom Telecommunications vs. CIG Pannonia Life
Performance |
| Timeline |
| NordTelekom Telecommunicatio |
| CIG Pannonia Life |
NordTelekom Telecommunicatio and CIG Pannonia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NordTelekom Telecommunicatio and CIG Pannonia
The main advantage of trading using opposite NordTelekom Telecommunicatio and CIG Pannonia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NordTelekom Telecommunicatio position performs unexpectedly, CIG Pannonia 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 CIG Pannonia will offset losses from the drop in CIG Pannonia's long position.| NordTelekom Telecommunicatio vs. OTP Bank Nyrt | NordTelekom Telecommunicatio vs. MOL Nyrt | NordTelekom Telecommunicatio vs. OPUS GLOBAL Nyrt | NordTelekom Telecommunicatio vs. ALTEO Energiaszolgaltato Nyrt |
| CIG Pannonia vs. Appeninn Nyrt | CIG Pannonia vs. Raba Jarmuipari Holding | CIG Pannonia vs. NordTelekom Telecommunications Service | CIG Pannonia vs. OPUS GLOBAL Nyrt |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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