Correlation Between Ondine Biomedical and Commerzbank
Can any of the company-specific risk be diversified away by investing in both Ondine Biomedical and Commerzbank 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 Ondine Biomedical and Commerzbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ondine Biomedical and Commerzbank AG, you can compare the effects of market volatilities on Ondine Biomedical and Commerzbank 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 Ondine Biomedical with a short position of Commerzbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ondine Biomedical and Commerzbank.
Diversification Opportunities for Ondine Biomedical and Commerzbank
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ondine and Commerzbank is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ondine Biomedical and Commerzbank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commerzbank AG and Ondine Biomedical 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 Ondine Biomedical are associated (or correlated) with Commerzbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commerzbank AG has no effect on the direction of Ondine Biomedical i.e., Ondine Biomedical and Commerzbank go up and down completely randomly.
Pair Corralation between Ondine Biomedical and Commerzbank
Assuming the 90 days trading horizon Ondine Biomedical is expected to generate 2.29 times more return on investment than Commerzbank. However, Ondine Biomedical is 2.29 times more volatile than Commerzbank AG. It trades about 0.09 of its potential returns per unit of risk. Commerzbank AG is currently generating about 0.08 per unit of risk. If you would invest 825.00 in Ondine Biomedical on October 26, 2024 and sell it today you would earn a total of 425.00 from holding Ondine Biomedical or generate 51.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ondine Biomedical vs. Commerzbank AG
Performance |
| Timeline |
| Ondine Biomedical |
| Commerzbank AG |
Ondine Biomedical and Commerzbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ondine Biomedical and Commerzbank
The main advantage of trading using opposite Ondine Biomedical and Commerzbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ondine Biomedical position performs unexpectedly, Commerzbank 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 Commerzbank will offset losses from the drop in Commerzbank's long position.| Ondine Biomedical vs. SupplyMe Capital PLC | Ondine Biomedical vs. Lloyds Banking Group | Ondine Biomedical vs. Premier African Minerals | Ondine Biomedical vs. SANTANDER UK 8 |
| Commerzbank vs. Livermore Investments Group | Commerzbank vs. Mobius Investment Trust | Commerzbank vs. BlackRock Frontiers Investment | Commerzbank vs. Ondine Biomedical |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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