Correlation Between Bank Polska and Boryszew
Can any of the company-specific risk be diversified away by investing in both Bank Polska and Boryszew 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 Bank Polska and Boryszew into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Polska Kasa and Boryszew SA, you can compare the effects of market volatilities on Bank Polska and Boryszew 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 Bank Polska with a short position of Boryszew. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Polska and Boryszew.
Diversification Opportunities for Bank Polska and Boryszew
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Boryszew is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bank Polska Kasa and Boryszew SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boryszew SA and Bank Polska 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 Bank Polska Kasa are associated (or correlated) with Boryszew. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boryszew SA has no effect on the direction of Bank Polska i.e., Bank Polska and Boryszew go up and down completely randomly.
Pair Corralation between Bank Polska and Boryszew
Assuming the 90 days trading horizon Bank Polska Kasa is expected to generate 1.77 times more return on investment than Boryszew. However, Bank Polska is 1.77 times more volatile than Boryszew SA. It trades about -0.05 of its potential returns per unit of risk. Boryszew SA is currently generating about -0.16 per unit of risk. If you would invest 14,345 in Bank Polska Kasa on August 29, 2024 and sell it today you would lose (440.00) from holding Bank Polska Kasa or give up 3.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank Polska Kasa vs. Boryszew SA
Performance |
| Timeline |
| Bank Polska Kasa |
| Boryszew SA |
Bank Polska and Boryszew Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Polska and Boryszew
The main advantage of trading using opposite Bank Polska and Boryszew positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Polska position performs unexpectedly, Boryszew 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 Boryszew will offset losses from the drop in Boryszew's long position.| Bank Polska vs. M Food SA | Bank Polska vs. Cloud Technologies SA | Bank Polska vs. Biztech Konsulting SA | Bank Polska vs. Quantum Software SA |
| Boryszew vs. Banco Santander SA | Boryszew vs. UniCredit SpA | Boryszew vs. CEZ as | Boryszew vs. Polski Koncern Naftowy |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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