Correlation Between Ultimate Games and Bank Handlowy
Can any of the company-specific risk be diversified away by investing in both Ultimate Games and Bank Handlowy 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 Ultimate Games and Bank Handlowy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultimate Games SA and Bank Handlowy w, you can compare the effects of market volatilities on Ultimate Games and Bank Handlowy 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 Ultimate Games with a short position of Bank Handlowy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultimate Games and Bank Handlowy.
Diversification Opportunities for Ultimate Games and Bank Handlowy
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ultimate and Bank is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Ultimate Games SA and Bank Handlowy w in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Handlowy w and Ultimate Games 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 Ultimate Games SA are associated (or correlated) with Bank Handlowy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Handlowy w has no effect on the direction of Ultimate Games i.e., Ultimate Games and Bank Handlowy go up and down completely randomly.
Pair Corralation between Ultimate Games and Bank Handlowy
Assuming the 90 days trading horizon Ultimate Games SA is expected to generate 0.78 times more return on investment than Bank Handlowy. However, Ultimate Games SA is 1.29 times less risky than Bank Handlowy. It trades about -0.12 of its potential returns per unit of risk. Bank Handlowy w is currently generating about -0.1 per unit of risk. If you would invest 896.00 in Ultimate Games SA on August 28, 2024 and sell it today you would lose (18.00) from holding Ultimate Games SA or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Ultimate Games SA vs. Bank Handlowy w
Performance |
| Timeline |
| Ultimate Games SA |
| Bank Handlowy w |
Ultimate Games and Bank Handlowy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultimate Games and Bank Handlowy
The main advantage of trading using opposite Ultimate Games and Bank Handlowy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultimate Games position performs unexpectedly, Bank Handlowy 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 Handlowy will offset losses from the drop in Bank Handlowy's long position.The idea behind Ultimate Games SA and Bank Handlowy w pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |