Correlation Between BAWAG Group and AT S

Can any of the company-specific risk be diversified away by investing in both BAWAG Group and AT S 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 BAWAG Group and AT S into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BAWAG Group AG and AT S Austria, you can compare the effects of market volatilities on BAWAG Group and AT S 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 BAWAG Group with a short position of AT S. Check out your portfolio center. Please also check ongoing floating volatility patterns of BAWAG Group and AT S.

Diversification Opportunities for BAWAG Group and AT S

-0.83

Correlation Coefficient

BAWAG Group  AT S

Pay attention - limited upside

The 3 months correlation between BAWAG and ATS is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding BAWAG Group AG and AT S Austria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AT S Austria and BAWAG Group 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 BAWAG Group AG are associated (or correlated) with AT S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AT S Austria has no effect on the direction of BAWAG Group i.e., BAWAG Group and AT S go up and down completely randomly.

Pair Corralation between BAWAG Group and AT S

Assuming the 90 days horizon BAWAG Group AG is expected to generate 0.45 times more return on investment than AT S. However, BAWAG Group AG is 2.25 times less risky than AT S. It trades about 0.16 of its potential returns per unit of risk. AT S Austria is currently generating about -0.13 per unit of risk. If you would invest  6,975  in BAWAG Group AG on September 12, 2024 and sell it today you would earn a total of  1,025  from holding BAWAG Group AG or generate 14.7% return on investment over 90 days.

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

BAWAG Group AG  vs.  AT S Austria

BAWAG Group AG

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BAWAG Group AG are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, BAWAG Group demonstrated solid returns over the last few months and may actually be approaching a breakup point.

AT S Austria

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AT S Austria has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with BAWAG Group and AT S

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

The idea behind BAWAG Group AG and AT S Austria 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..