Correlation Between OPUS GLOBAL and Commerzbank
Can any of the company-specific risk be diversified away by investing in both OPUS GLOBAL 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 OPUS GLOBAL and Commerzbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OPUS GLOBAL Nyrt and Commerzbank AG, you can compare the effects of market volatilities on OPUS GLOBAL 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 OPUS GLOBAL with a short position of Commerzbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of OPUS GLOBAL and Commerzbank.
Diversification Opportunities for OPUS GLOBAL and Commerzbank
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between OPUS and Commerzbank is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding OPUS GLOBAL Nyrt and Commerzbank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commerzbank AG and OPUS GLOBAL 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 OPUS GLOBAL Nyrt 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 OPUS GLOBAL i.e., OPUS GLOBAL and Commerzbank go up and down completely randomly.
Pair Corralation between OPUS GLOBAL and Commerzbank
Assuming the 90 days trading horizon OPUS GLOBAL Nyrt is expected to generate 0.32 times more return on investment than Commerzbank. However, OPUS GLOBAL Nyrt is 3.1 times less risky than Commerzbank. It trades about -0.1 of its potential returns per unit of risk. Commerzbank AG is currently generating about -0.47 per unit of risk. If you would invest 51,300 in OPUS GLOBAL Nyrt on August 29, 2024 and sell it today you would lose (900.00) from holding OPUS GLOBAL Nyrt or give up 1.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 40.91% |
| Values | Daily Returns |
OPUS GLOBAL Nyrt vs. Commerzbank AG
Performance |
| Timeline |
| OPUS GLOBAL Nyrt |
| Commerzbank AG |
OPUS GLOBAL and Commerzbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OPUS GLOBAL and Commerzbank
The main advantage of trading using opposite OPUS GLOBAL and Commerzbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OPUS GLOBAL 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.| OPUS GLOBAL vs. NordTelekom Telecommunications Service | OPUS GLOBAL vs. CIG Pannonia Life | OPUS GLOBAL vs. Infineon Technologies AG | OPUS GLOBAL vs. Nutex Investments PLC |
| Commerzbank vs. NordTelekom Telecommunications Service | Commerzbank vs. Nutex Investments PLC | Commerzbank vs. Delta Technologies 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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