Correlation Between Optima Bank and Viohalco
Can any of the company-specific risk be diversified away by investing in both Optima Bank and Viohalco 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 Viohalco 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 Viohalco SA, you can compare the effects of market volatilities on Optima Bank and Viohalco 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 Viohalco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Optima Bank and Viohalco.
Diversification Opportunities for Optima Bank and Viohalco
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Optima and Viohalco is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Optima bank SA and Viohalco SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viohalco SA 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 Viohalco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viohalco SA has no effect on the direction of Optima Bank i.e., Optima Bank and Viohalco go up and down completely randomly.
Pair Corralation between Optima Bank and Viohalco
Assuming the 90 days trading horizon Optima bank SA is expected to generate 0.6 times more return on investment than Viohalco. However, Optima bank SA is 1.66 times less risky than Viohalco. It trades about 0.35 of its potential returns per unit of risk. Viohalco SA is currently generating about -0.05 per unit of risk. If you would invest 1,300 in Optima bank SA on November 28, 2024 and sell it today you would earn a total of 126.00 from holding Optima bank SA or generate 9.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Optima bank SA vs. Viohalco SA
Performance |
| Timeline |
| Optima bank SA |
| Viohalco SA |
Optima Bank and Viohalco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Optima Bank and Viohalco
The main advantage of trading using opposite Optima Bank and Viohalco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Optima Bank position performs unexpectedly, Viohalco 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 Viohalco will offset losses from the drop in Viohalco's long position.| Optima Bank vs. Hellenic Telecommunications Organization | Optima Bank vs. Interlife General Insurance | Optima Bank vs. Foodlink AE | Optima Bank vs. Lampsa Hellenic Hotels |
| Viohalco vs. Performance Technologies SA | Viohalco vs. Attica Bank SA | Viohalco vs. Thrace Plastics Holding | Viohalco vs. Optima bank SA |
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.
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