Correlation Between Podravka Prehrambena and Dalekovod
Can any of the company-specific risk be diversified away by investing in both Podravka Prehrambena and Dalekovod 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 Podravka Prehrambena and Dalekovod into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Podravka Prehrambena Industrija and Dalekovod dd, you can compare the effects of market volatilities on Podravka Prehrambena and Dalekovod 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 Podravka Prehrambena with a short position of Dalekovod. Check out your portfolio center. Please also check ongoing floating volatility patterns of Podravka Prehrambena and Dalekovod.
Diversification Opportunities for Podravka Prehrambena and Dalekovod
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Podravka and Dalekovod is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Podravka Prehrambena Industrij and Dalekovod dd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalekovod dd and Podravka Prehrambena 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 Podravka Prehrambena Industrija are associated (or correlated) with Dalekovod. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalekovod dd has no effect on the direction of Podravka Prehrambena i.e., Podravka Prehrambena and Dalekovod go up and down completely randomly.
Pair Corralation between Podravka Prehrambena and Dalekovod
Assuming the 90 days trading horizon Podravka Prehrambena Industrija is expected to under-perform the Dalekovod. But the stock apears to be less risky and, when comparing its historical volatility, Podravka Prehrambena Industrija is 1.61 times less risky than Dalekovod. The stock trades about -0.03 of its potential returns per unit of risk. The Dalekovod dd is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 344.00 in Dalekovod dd on October 20, 2024 and sell it today you would earn a total of 90.00 from holding Dalekovod dd or generate 26.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Podravka Prehrambena Industrij vs. Dalekovod dd
Performance |
| Timeline |
| Podravka Prehrambena |
| Dalekovod dd |
Podravka Prehrambena and Dalekovod Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Podravka Prehrambena and Dalekovod
The main advantage of trading using opposite Podravka Prehrambena and Dalekovod positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Podravka Prehrambena position performs unexpectedly, Dalekovod 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 Dalekovod will offset losses from the drop in Dalekovod's long position.| Podravka Prehrambena vs. Dalekovod dd | Podravka Prehrambena vs. Institut IGH dd | Podravka Prehrambena vs. Jadroplov dd | Podravka Prehrambena vs. KRA dd |
| Dalekovod vs. Institut IGH dd | Dalekovod vs. Jadroplov dd | Dalekovod vs. Zagrebacka Banka dd | Dalekovod vs. Podravka Prehrambena Industrija |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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