Correlation Between Optima Bank and CPI Computer
Can any of the company-specific risk be diversified away by investing in both Optima Bank and CPI Computer 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 Optima Bank and CPI Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Optima bank SA and CPI Computer Peripherals, you can compare the effects of market volatilities on Optima Bank and CPI Computer 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 Optima Bank with a short position of CPI Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Optima Bank and CPI Computer.
Diversification Opportunities for Optima Bank and CPI Computer
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Optima and CPI is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Optima bank SA and CPI Computer Peripherals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CPI Computer Peripherals and Optima Bank 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 Optima bank SA are associated (or correlated) with CPI Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CPI Computer Peripherals has no effect on the direction of Optima Bank i.e., Optima Bank and CPI Computer go up and down completely randomly.
Pair Corralation between Optima Bank and CPI Computer
Assuming the 90 days trading horizon Optima bank SA is expected to generate 0.42 times more return on investment than CPI Computer. However, Optima bank SA is 2.38 times less risky than CPI Computer. It trades about 0.17 of its potential returns per unit of risk. CPI Computer Peripherals is currently generating about -0.16 per unit of risk. If you would invest 1,262 in Optima bank SA on August 28, 2024 and sell it today you would earn a total of 40.00 from holding Optima bank SA or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Optima bank SA vs. CPI Computer Peripherals
Performance |
| Timeline |
| Optima bank SA |
| CPI Computer Peripherals |
Optima Bank and CPI Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Optima Bank and CPI Computer
The main advantage of trading using opposite Optima Bank and CPI Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Optima Bank position performs unexpectedly, CPI Computer 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 CPI Computer will offset losses from the drop in CPI Computer's long position.| Optima Bank vs. Coca Cola HBC AG | Optima Bank vs. Hellenic Telecommunications Organization | Optima Bank vs. Greek Organization of | Optima Bank vs. Eurobank Ergasias Services |
| CPI Computer vs. Performance Technologies SA | CPI Computer vs. National Bank of | CPI Computer vs. EL D Mouzakis | CPI Computer vs. Lampsa Hellenic Hotels |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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