Correlation Between OTP Bank and Jacquet Metal

Can any of the company-specific risk be diversified away by investing in both OTP Bank and Jacquet Metal 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 OTP Bank and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between OTP Bank Nyrt and Jacquet Metal Service, you can compare the effects of market volatilities on OTP Bank and Jacquet Metal 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 OTP Bank with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of OTP Bank and Jacquet Metal.

Diversification Opportunities for OTP Bank and Jacquet Metal

-0.18

Correlation Coefficient

OTP Bank  Jacquet Metal

Good diversification

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

Pair Corralation between OTP Bank and Jacquet Metal

If you would invest  1,600  in Jacquet Metal Service on October 5, 2024 and sell it today you would earn a total of  141.00  from holding Jacquet Metal Service or generate 8.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

OTP Bank Nyrt  vs.  Jacquet Metal Service

OTP Bank Nyrt

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in OTP Bank Nyrt are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, OTP Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Jacquet Metal Service

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jacquet Metal Service are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Jacquet Metal may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with OTP Bank and Jacquet Metal

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

The idea behind OTP Bank Nyrt and Jacquet Metal Service 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.