Correlation Between National Bank and Attica Bank

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

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

Diversification Opportunities for National Bank and Attica Bank

0.34

Correlation Coefficient

National Bank  Attica Bank

Weak diversification

The 3 months correlation between National and Attica is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Attica Bank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Attica Bank SA and National 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 National Bank of are associated (or correlated) with Attica Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Attica Bank SA has no effect on the direction of National Bank i.e., National Bank and Attica Bank go up and down completely randomly.

Pair Corralation between National Bank and Attica Bank

Assuming the 90 days trading horizon National Bank of is expected to generate 0.05 times more return on investment than Attica Bank. However, National Bank of is 20.67 times less risky than Attica Bank. It trades about 0.06 of its potential returns per unit of risk. Attica Bank SA is currently generating about 0.0 per unit of risk. If you would invest  731.00  in National Bank of on September 13, 2024 and sell it today you would earn a total of  42.00  from holding National Bank of or generate 5.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

National Bank of  vs.  Attica Bank SA

National Bank

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in National Bank of are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, National Bank may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Attica Bank SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Attica Bank SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Attica Bank is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with National Bank and Attica Bank

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

The idea behind National Bank of and Attica 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.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.