Correlation Between Schroder Real and OneSavings Bank
Can any of the company-specific risk be diversified away by investing in both Schroder Real and OneSavings Bank 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 Schroder Real and OneSavings Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schroder Real Estate and OneSavings Bank PLC, you can compare the effects of market volatilities on Schroder Real and OneSavings Bank 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 Schroder Real with a short position of OneSavings Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schroder Real and OneSavings Bank.
Diversification Opportunities for Schroder Real and OneSavings Bank
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Schroder and OneSavings is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Schroder Real Estate and OneSavings Bank PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneSavings Bank PLC and Schroder Real 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 Schroder Real Estate are associated (or correlated) with OneSavings Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneSavings Bank PLC has no effect on the direction of Schroder Real i.e., Schroder Real and OneSavings Bank go up and down completely randomly.
Pair Corralation between Schroder Real and OneSavings Bank
Assuming the 90 days trading horizon Schroder Real Estate is expected to under-perform the OneSavings Bank. But the stock apears to be less risky and, when comparing its historical volatility, Schroder Real Estate is 1.3 times less risky than OneSavings Bank. The stock trades about -0.03 of its potential returns per unit of risk. The OneSavings Bank PLC is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 35,380 in OneSavings Bank PLC on September 1, 2024 and sell it today you would earn a total of 4,860 from holding OneSavings Bank PLC or generate 13.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Schroder Real Estate vs. OneSavings Bank PLC
Performance |
| Timeline |
| Schroder Real Estate |
| OneSavings Bank PLC |
Schroder Real and OneSavings Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schroder Real and OneSavings Bank
The main advantage of trading using opposite Schroder Real and OneSavings Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schroder Real position performs unexpectedly, OneSavings Bank 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 OneSavings Bank will offset losses from the drop in OneSavings Bank's long position.| Schroder Real vs. Hammerson PLC | Schroder Real vs. Workspace Group PLC | Schroder Real vs. Supermarket Income REIT | Schroder Real vs. Diversified Energy |
| OneSavings Bank vs. Atalaya Mining | OneSavings Bank vs. Endeavour Mining Corp | OneSavings Bank vs. iShares Physical Silver | OneSavings Bank vs. Eastinco Mining Exploration |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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