Correlation Between OneSavings Bank and Gamma Communications
Can any of the company-specific risk be diversified away by investing in both OneSavings Bank and Gamma Communications 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 OneSavings Bank and Gamma Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OneSavings Bank PLC and Gamma Communications PLC, you can compare the effects of market volatilities on OneSavings Bank and Gamma Communications 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 OneSavings Bank with a short position of Gamma Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of OneSavings Bank and Gamma Communications.
Diversification Opportunities for OneSavings Bank and Gamma Communications
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between OneSavings and Gamma is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding OneSavings Bank PLC and Gamma Communications PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamma Communications PLC and OneSavings 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 OneSavings Bank PLC are associated (or correlated) with Gamma Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamma Communications PLC has no effect on the direction of OneSavings Bank i.e., OneSavings Bank and Gamma Communications go up and down completely randomly.
Pair Corralation between OneSavings Bank and Gamma Communications
Assuming the 90 days trading horizon OneSavings Bank PLC is expected to generate 1.51 times more return on investment than Gamma Communications. However, OneSavings Bank is 1.51 times more volatile than Gamma Communications PLC. It trades about 0.17 of its potential returns per unit of risk. Gamma Communications PLC is currently generating about -0.01 per unit of risk. If you would invest 36,020 in OneSavings Bank PLC on August 30, 2024 and sell it today you would earn a total of 2,300 from holding OneSavings Bank PLC or generate 6.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OneSavings Bank PLC vs. Gamma Communications PLC
Performance |
| Timeline |
| OneSavings Bank PLC |
| Gamma Communications PLC |
OneSavings Bank and Gamma Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OneSavings Bank and Gamma Communications
The main advantage of trading using opposite OneSavings Bank and Gamma Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OneSavings Bank position performs unexpectedly, Gamma Communications 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 Gamma Communications will offset losses from the drop in Gamma Communications' long position.| OneSavings Bank vs. Chocoladefabriken Lindt Spruengli | OneSavings Bank vs. National Atomic Co | OneSavings Bank vs. OTP Bank Nyrt | OneSavings Bank vs. Samsung Electronics Co |
| Gamma Communications vs. CVR Energy | Gamma Communications vs. Viridian Therapeutics | Gamma Communications vs. Dollar Tree | Gamma Communications vs. News Corp Cl |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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