Correlation Between Raiffeisen Bank and RMS Mezzanine
Can any of the company-specific risk be diversified away by investing in both Raiffeisen Bank and RMS Mezzanine 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 Raiffeisen Bank and RMS Mezzanine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raiffeisen Bank International and RMS Mezzanine AS, you can compare the effects of market volatilities on Raiffeisen Bank and RMS Mezzanine 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 Raiffeisen Bank with a short position of RMS Mezzanine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raiffeisen Bank and RMS Mezzanine.
Diversification Opportunities for Raiffeisen Bank and RMS Mezzanine
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Raiffeisen and RMS is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Raiffeisen Bank International and RMS Mezzanine AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RMS Mezzanine AS and Raiffeisen 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 Raiffeisen Bank International are associated (or correlated) with RMS Mezzanine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RMS Mezzanine AS has no effect on the direction of Raiffeisen Bank i.e., Raiffeisen Bank and RMS Mezzanine go up and down completely randomly.
Pair Corralation between Raiffeisen Bank and RMS Mezzanine
Assuming the 90 days trading horizon Raiffeisen Bank International is expected to under-perform the RMS Mezzanine. But the stock apears to be less risky and, when comparing its historical volatility, Raiffeisen Bank International is 3.16 times less risky than RMS Mezzanine. The stock trades about -0.01 of its potential returns per unit of risk. The RMS Mezzanine AS is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 140.00 in RMS Mezzanine AS on August 28, 2024 and sell it today you would earn a total of 27.00 from holding RMS Mezzanine AS or generate 19.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raiffeisen Bank International vs. RMS Mezzanine AS
Performance |
| Timeline |
| Raiffeisen Bank Inte |
| RMS Mezzanine AS |
Raiffeisen Bank and RMS Mezzanine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raiffeisen Bank and RMS Mezzanine
The main advantage of trading using opposite Raiffeisen Bank and RMS Mezzanine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raiffeisen Bank position performs unexpectedly, RMS Mezzanine 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 RMS Mezzanine will offset losses from the drop in RMS Mezzanine's long position.| Raiffeisen Bank vs. Cez AS | Raiffeisen Bank vs. Kofola CeskoSlovensko as | Raiffeisen Bank vs. Primoco UAV SE | Raiffeisen Bank vs. MT 1997 AS |
| RMS Mezzanine vs. JT ARCH INVESTMENTS | RMS Mezzanine vs. Moneta Money Bank | RMS Mezzanine vs. Komercni Banka AS | RMS Mezzanine vs. Raiffeisen Bank International |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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