Correlation Between Penta Ocean and BANK HANDLOWY
Can any of the company-specific risk be diversified away by investing in both Penta Ocean and BANK HANDLOWY 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 Penta Ocean and BANK HANDLOWY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Penta Ocean Construction Co and BANK HANDLOWY, you can compare the effects of market volatilities on Penta Ocean and BANK HANDLOWY 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 Penta Ocean with a short position of BANK HANDLOWY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penta Ocean and BANK HANDLOWY.
Diversification Opportunities for Penta Ocean and BANK HANDLOWY
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Penta and BANK is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Penta Ocean Construction Co and BANK HANDLOWY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK HANDLOWY and Penta Ocean 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 Penta Ocean Construction Co are associated (or correlated) with BANK HANDLOWY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK HANDLOWY has no effect on the direction of Penta Ocean i.e., Penta Ocean and BANK HANDLOWY go up and down completely randomly.
Pair Corralation between Penta Ocean and BANK HANDLOWY
Assuming the 90 days horizon Penta Ocean Construction Co is expected to generate 2.14 times more return on investment than BANK HANDLOWY. However, Penta Ocean is 2.14 times more volatile than BANK HANDLOWY. It trades about 0.0 of its potential returns per unit of risk. BANK HANDLOWY is currently generating about -0.03 per unit of risk. If you would invest 380.00 in Penta Ocean Construction Co on September 22, 2024 and sell it today you would lose (2.00) from holding Penta Ocean Construction Co or give up 0.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penta Ocean Construction Co vs. BANK HANDLOWY
Performance |
| Timeline |
| Penta Ocean Construc |
| BANK HANDLOWY |
Penta Ocean and BANK HANDLOWY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penta Ocean and BANK HANDLOWY
The main advantage of trading using opposite Penta Ocean and BANK HANDLOWY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penta Ocean position performs unexpectedly, BANK HANDLOWY 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 BANK HANDLOWY will offset losses from the drop in BANK HANDLOWY's long position.| Penta Ocean vs. The Trade Desk | Penta Ocean vs. QUEEN S ROAD | Penta Ocean vs. Fast Retailing Co | Penta Ocean vs. RETAIL FOOD GROUP |
| BANK HANDLOWY vs. Penta Ocean Construction Co | BANK HANDLOWY vs. Chongqing Machinery Electric | BANK HANDLOWY vs. ALIOR BANK | BANK HANDLOWY vs. Sterling Construction |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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