Correlation Between BKS Bank and Oesterr Post

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

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

Diversification Opportunities for BKS Bank and Oesterr Post

0.56

Correlation Coefficient

BKS Bank  Oesterr Post

Very weak diversification

The 3 months correlation between BKS and Oesterr is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding BKS Bank AG and Oesterr Post AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oesterr Post AG and BKS 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 BKS Bank AG are associated (or correlated) with Oesterr Post. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oesterr Post AG has no effect on the direction of BKS Bank i.e., BKS Bank and Oesterr Post go up and down completely randomly.

Pair Corralation between BKS Bank and Oesterr Post

Assuming the 90 days trading horizon BKS Bank is expected to generate 2.16 times less return on investment than Oesterr Post. In addition to that, BKS Bank is 1.11 times more volatile than Oesterr Post AG. It trades about 0.07 of its total potential returns per unit of risk. Oesterr Post AG is currently generating about 0.17 per unit of volatility. If you would invest  2,860  in Oesterr Post AG on December 27, 2024 and sell it today you would earn a total of  305.00  from holding Oesterr Post AG or generate 10.66% return on investment over 90 days.

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

BKS Bank AG  vs.  Oesterr Post AG

BKS Bank AG

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BKS Bank AG are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, BKS Bank is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Oesterr Post AG

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Oesterr Post AG are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Oesterr Post may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with BKS Bank and Oesterr Post

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

The idea behind BKS Bank AG and Oesterr Post AG 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.