Correlation Between State Bank and AstraZeneca PLC
Can any of the company-specific risk be diversified away by investing in both State Bank and AstraZeneca PLC 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 State Bank and AstraZeneca PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Bank of and AstraZeneca PLC, you can compare the effects of market volatilities on State Bank and AstraZeneca PLC 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 State Bank with a short position of AstraZeneca PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Bank and AstraZeneca PLC.
Diversification Opportunities for State Bank and AstraZeneca PLC
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between State and AstraZeneca is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding State Bank of and AstraZeneca PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AstraZeneca PLC and State 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 State Bank of are associated (or correlated) with AstraZeneca PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AstraZeneca PLC has no effect on the direction of State Bank i.e., State Bank and AstraZeneca PLC go up and down completely randomly.
Pair Corralation between State Bank and AstraZeneca PLC
Assuming the 90 days horizon State Bank of is expected to generate 1.29 times more return on investment than AstraZeneca PLC. However, State Bank is 1.29 times more volatile than AstraZeneca PLC. It trades about 0.05 of its potential returns per unit of risk. AstraZeneca PLC is currently generating about 0.01 per unit of risk. If you would invest 6,678 in State Bank of on August 30, 2024 and sell it today you would earn a total of 2,722 from holding State Bank of or generate 40.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Bank of vs. AstraZeneca PLC
Performance |
| Timeline |
| State Bank |
| AstraZeneca PLC |
State Bank and AstraZeneca PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Bank and AstraZeneca PLC
The main advantage of trading using opposite State Bank and AstraZeneca PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Bank position performs unexpectedly, AstraZeneca PLC 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 AstraZeneca PLC will offset losses from the drop in AstraZeneca PLC's long position.| State Bank vs. GEELY AUTOMOBILE | State Bank vs. Global Ship Lease | State Bank vs. Sporttotal AG | State Bank vs. CARSALESCOM |
| AstraZeneca PLC vs. Johnson Johnson | AstraZeneca PLC vs. Pfizer Inc | AstraZeneca PLC vs. Amgen Inc | AstraZeneca PLC vs. General Mills |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |