Correlation Between Automatic Bank and Malam Team
Can any of the company-specific risk be diversified away by investing in both Automatic Bank and Malam Team 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 Automatic Bank and Malam Team into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Automatic Bank Services and Malam Team, you can compare the effects of market volatilities on Automatic Bank and Malam Team 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 Automatic Bank with a short position of Malam Team. Check out your portfolio center. Please also check ongoing floating volatility patterns of Automatic Bank and Malam Team.
Diversification Opportunities for Automatic Bank and Malam Team
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Automatic and Malam is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Automatic Bank Services and Malam Team in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malam Team and Automatic 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 Automatic Bank Services are associated (or correlated) with Malam Team. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malam Team has no effect on the direction of Automatic Bank i.e., Automatic Bank and Malam Team go up and down completely randomly.
Pair Corralation between Automatic Bank and Malam Team
Assuming the 90 days trading horizon Automatic Bank Services is expected to generate 0.98 times more return on investment than Malam Team. However, Automatic Bank Services is 1.02 times less risky than Malam Team. It trades about 0.05 of its potential returns per unit of risk. Malam Team is currently generating about 0.01 per unit of risk. If you would invest 142,258 in Automatic Bank Services on August 29, 2024 and sell it today you would earn a total of 61,642 from holding Automatic Bank Services or generate 43.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Automatic Bank Services vs. Malam Team
Performance |
| Timeline |
| Automatic Bank Services |
| Malam Team |
Automatic Bank and Malam Team Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Automatic Bank and Malam Team
The main advantage of trading using opposite Automatic Bank and Malam Team positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Automatic Bank position performs unexpectedly, Malam Team 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 Malam Team will offset losses from the drop in Malam Team's long position.| Automatic Bank vs. Unitronics | Automatic Bank vs. PCB Tec | Automatic Bank vs. Tower Semiconductor | Automatic Bank vs. Priortech |
| Malam Team vs. Automatic Bank Services | Malam Team vs. EN Shoham Business | Malam Team vs. Rapac Communication Infrastructure | Malam Team vs. Tadiran Hldg |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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