Correlation Between Komercni Banka and Helios Towers

Can any of the company-specific risk be diversified away by investing in both Komercni Banka and Helios Towers 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 Komercni Banka and Helios Towers into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Komercni Banka and Helios Towers Plc, you can compare the effects of market volatilities on Komercni Banka and Helios Towers 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 Komercni Banka with a short position of Helios Towers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Komercni Banka and Helios Towers.

Diversification Opportunities for Komercni Banka and Helios Towers

-0.18

Correlation Coefficient

Komercni Banka  Helios Towers

Good diversification

The 3 months correlation between Komercni and Helios is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Komercni Banka and Helios Towers Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helios Towers Plc and Komercni Banka 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 Komercni Banka are associated (or correlated) with Helios Towers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helios Towers Plc has no effect on the direction of Komercni Banka i.e., Komercni Banka and Helios Towers go up and down completely randomly.

Pair Corralation between Komercni Banka and Helios Towers

If you would invest  9,550  in Helios Towers Plc on December 5, 2024 and sell it today you would earn a total of  160.00  from holding Helios Towers Plc or generate 1.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.65%
Values	Daily Returns

Komercni Banka  vs.  Helios Towers Plc

Komercni Banka

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Komercni Banka are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Komercni Banka unveiled solid returns over the last few months and may actually be approaching a breakup point.

Helios Towers Plc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Helios Towers Plc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Helios Towers is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Komercni Banka and Helios Towers

The main advantage of trading using opposite Komercni Banka and Helios Towers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Komercni Banka position performs unexpectedly, Helios Towers 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 Helios Towers will offset losses from the drop in Helios Towers' long position.

The idea behind Komercni Banka and Helios Towers Plc 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.

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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 Valuation module to check real value of public entities based on technical and fundamental data.