Correlation Between Hrvatska Postanska and Ingra Dd

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

By analyzing existing cross correlation between Hrvatska Postanska Banka and Ingra dd, you can compare the effects of market volatilities on Hrvatska Postanska and Ingra Dd 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 Hrvatska Postanska with a short position of Ingra Dd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hrvatska Postanska and Ingra Dd.

Diversification Opportunities for Hrvatska Postanska and Ingra Dd

-0.65

Correlation Coefficient

Hrvatska Postanska  Ingra Dd

Excellent diversification

The 3 months correlation between Hrvatska and Ingra is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Hrvatska Postanska Banka and Ingra dd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingra dd and Hrvatska Postanska 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 Hrvatska Postanska Banka are associated (or correlated) with Ingra Dd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingra dd has no effect on the direction of Hrvatska Postanska i.e., Hrvatska Postanska and Ingra Dd go up and down completely randomly.

Pair Corralation between Hrvatska Postanska and Ingra Dd

Assuming the 90 days trading horizon Hrvatska Postanska Banka is expected to generate 0.6 times more return on investment than Ingra Dd. However, Hrvatska Postanska Banka is 1.66 times less risky than Ingra Dd. It trades about 0.26 of its potential returns per unit of risk. Ingra dd is currently generating about -0.08 per unit of risk. If you would invest  23,000  in Hrvatska Postanska Banka on September 3, 2024 and sell it today you would earn a total of  8,000  from holding Hrvatska Postanska Banka or generate 34.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.21%
Values	Daily Returns

Hrvatska Postanska Banka  vs.  Ingra dd

Hrvatska Postanska Banka

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Hrvatska Postanska Banka are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Hrvatska Postanska exhibited solid returns over the last few months and may actually be approaching a breakup point.

Ingra dd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ingra dd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Hrvatska Postanska and Ingra Dd

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

The idea behind Hrvatska Postanska Banka and Ingra dd 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.