Correlation Between OTP Bank and Jardine Matheson

Can any of the company-specific risk be diversified away by investing in both OTP Bank and Jardine Matheson 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 Jardine Matheson 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 Jardine Matheson Holdings, you can compare the effects of market volatilities on OTP Bank and Jardine Matheson 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 Jardine Matheson. Check out your portfolio center. Please also check ongoing floating volatility patterns of OTP Bank and Jardine Matheson.

Diversification Opportunities for OTP Bank and Jardine Matheson

0.0

Correlation Coefficient

OTP Bank  Jardine Matheson

Pay attention - limited upside

The 3 months correlation between OTP and Jardine is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding OTP Bank Nyrt and Jardine Matheson Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jardine Matheson Holdings 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 Jardine Matheson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jardine Matheson Holdings has no effect on the direction of OTP Bank i.e., OTP Bank and Jardine Matheson go up and down completely randomly.

Pair Corralation between OTP Bank and Jardine Matheson

If you would invest  6,250  in Jardine Matheson Holdings on October 5, 2024 and sell it today you would earn a total of  0.00  from holding Jardine Matheson Holdings or generate 0.0% return on investment over 90 days.

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

OTP Bank Nyrt  vs.  Jardine Matheson Holdings

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.

Jardine Matheson Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jardine Matheson Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Jardine Matheson is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with OTP Bank and Jardine Matheson

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

The idea behind OTP Bank Nyrt and Jardine Matheson Holdings 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.