Correlation Between Shoper SA and Bank Millennium
Can any of the company-specific risk be diversified away by investing in both Shoper SA and Bank Millennium 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 Shoper SA and Bank Millennium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shoper SA and Bank Millennium SA, you can compare the effects of market volatilities on Shoper SA and Bank Millennium 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 Shoper SA with a short position of Bank Millennium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shoper SA and Bank Millennium.
Diversification Opportunities for Shoper SA and Bank Millennium
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shoper and Bank is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Shoper SA and Bank Millennium SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Millennium SA and Shoper SA 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 Shoper SA are associated (or correlated) with Bank Millennium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Millennium SA has no effect on the direction of Shoper SA i.e., Shoper SA and Bank Millennium go up and down completely randomly.
Pair Corralation between Shoper SA and Bank Millennium
Assuming the 90 days trading horizon Shoper SA is expected to generate 1.44 times less return on investment than Bank Millennium. But when comparing it to its historical volatility, Shoper SA is 1.01 times less risky than Bank Millennium. It trades about 0.04 of its potential returns per unit of risk. Bank Millennium SA is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 464.00 in Bank Millennium SA on September 4, 2024 and sell it today you would earn a total of 381.00 from holding Bank Millennium SA or generate 82.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Shoper SA vs. Bank Millennium SA
Performance |
| Timeline |
| Shoper SA |
| Bank Millennium SA |
Shoper SA and Bank Millennium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shoper SA and Bank Millennium
The main advantage of trading using opposite Shoper SA and Bank Millennium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shoper SA position performs unexpectedly, Bank Millennium 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 Millennium will offset losses from the drop in Bank Millennium's long position.| Shoper SA vs. Marie Brizard Wine | Shoper SA vs. UF Games SA | Shoper SA vs. Centrum Finansowe Banku | Shoper SA vs. ING Bank lski |
| Bank Millennium vs. UniCredit SpA | Bank Millennium vs. Santander Bank Polska | Bank Millennium vs. Bank Handlowy w | Bank Millennium vs. BNP Paribas Bank |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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