Correlation Between Optima Bank and Prodea Real
Can any of the company-specific risk be diversified away by investing in both Optima Bank and Prodea Real 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 Prodea Real 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 Prodea Real Estate, you can compare the effects of market volatilities on Optima Bank and Prodea Real 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 Prodea Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Optima Bank and Prodea Real.
Diversification Opportunities for Optima Bank and Prodea Real
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Optima and Prodea is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Optima bank SA and Prodea Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodea Real Estate 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 Prodea Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodea Real Estate has no effect on the direction of Optima Bank i.e., Optima Bank and Prodea Real go up and down completely randomly.
Pair Corralation between Optima Bank and Prodea Real
Assuming the 90 days trading horizon Optima bank SA is expected to generate 0.65 times more return on investment than Prodea Real. However, Optima bank SA is 1.54 times less risky than Prodea Real. It trades about 0.14 of its potential returns per unit of risk. Prodea Real Estate is currently generating about -0.02 per unit of risk. If you would invest 696.00 in Optima bank SA on September 3, 2024 and sell it today you would earn a total of 564.00 from holding Optima bank SA or generate 81.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 71.08% |
| Values | Daily Returns |
Optima bank SA vs. Prodea Real Estate
Performance |
| Timeline |
| Optima bank SA |
| Prodea Real Estate |
Optima Bank and Prodea Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Optima Bank and Prodea Real
The main advantage of trading using opposite Optima Bank and Prodea Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Optima Bank position performs unexpectedly, Prodea Real 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 Prodea Real will offset losses from the drop in Prodea Real's long position.| Optima Bank vs. Hellenic Telecommunications Organization | Optima Bank vs. Greek Organization of | Optima Bank vs. Eurobank Ergasias Services | Optima Bank vs. National Bank of |
| Prodea Real vs. Hellenic Telecommunications Organization | Prodea Real vs. Profile Systems Software | Prodea Real vs. Optima bank SA | Prodea Real vs. As Commercial Industrial |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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