Correlation Between APAC Old and Alpha Bank

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

By analyzing existing cross correlation between APAC Old and Alpha Bank SA, you can compare the effects of market volatilities on APAC Old and Alpha 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 APAC Old with a short position of Alpha Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of APAC Old and Alpha Bank.

Diversification Opportunities for APAC Old and Alpha Bank

0.0

Correlation Coefficient

APAC Old  Alpha Bank

Pay attention - limited upside

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

Pair Corralation between APAC Old and Alpha Bank

If you would invest  38.00  in Alpha Bank SA on December 30, 2024 and sell it today you would earn a total of  29.00  from holding Alpha Bank SA or generate 76.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

APAC Old  vs.  Alpha Bank SA

APAC Old

Risk-Adjusted Performance

Very Weak

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

Alpha Bank SA

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Bank SA are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile forward-looking signals, Alpha Bank showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with APAC Old and Alpha Bank

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

The idea behind APAC Old and Alpha Bank SA 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.