Correlation Between Patria Bank and Societatea Nationala
Can any of the company-specific risk be diversified away by investing in both Patria Bank and Societatea Nationala 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 Patria Bank and Societatea Nationala into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Patria Bank SA and Societatea Nationala de, you can compare the effects of market volatilities on Patria Bank and Societatea Nationala 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 Patria Bank with a short position of Societatea Nationala. Check out your portfolio center. Please also check ongoing floating volatility patterns of Patria Bank and Societatea Nationala.
Diversification Opportunities for Patria Bank and Societatea Nationala
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Patria and Societatea is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Patria Bank SA and Societatea Nationala de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Societatea Nationala and Patria 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 Patria Bank SA are associated (or correlated) with Societatea Nationala. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Societatea Nationala has no effect on the direction of Patria Bank i.e., Patria Bank and Societatea Nationala go up and down completely randomly.
Pair Corralation between Patria Bank and Societatea Nationala
Assuming the 90 days trading horizon Patria Bank SA is expected to generate 0.9 times more return on investment than Societatea Nationala. However, Patria Bank SA is 1.12 times less risky than Societatea Nationala. It trades about -0.14 of its potential returns per unit of risk. Societatea Nationala de is currently generating about -0.24 per unit of risk. If you would invest 8.45 in Patria Bank SA on September 1, 2024 and sell it today you would lose (0.35) from holding Patria Bank SA or give up 4.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Patria Bank SA vs. Societatea Nationala de
Performance |
| Timeline |
| Patria Bank SA |
| Societatea Nationala |
Patria Bank and Societatea Nationala Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Patria Bank and Societatea Nationala
The main advantage of trading using opposite Patria Bank and Societatea Nationala positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Patria Bank position performs unexpectedly, Societatea Nationala 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 Societatea Nationala will offset losses from the drop in Societatea Nationala's long position.| Patria Bank vs. Teraplast Bist | Patria Bank vs. Electroarges S | Patria Bank vs. Comvex SA | Patria Bank vs. Feper SA |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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