Correlation Between Halyk Bank and Futura Medical

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

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

Diversification Opportunities for Halyk Bank and Futura Medical

-0.18

Correlation Coefficient

Halyk Bank  Futura Medical

Good diversification

The 3 months correlation between Halyk and Futura is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Halyk Bank of and Futura Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Futura Medical and Halyk 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 Halyk Bank of are associated (or correlated) with Futura Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Futura Medical has no effect on the direction of Halyk Bank i.e., Halyk Bank and Futura Medical go up and down completely randomly.

Pair Corralation between Halyk Bank and Futura Medical

Assuming the 90 days trading horizon Halyk Bank of is expected to generate 0.48 times more return on investment than Futura Medical. However, Halyk Bank of is 2.06 times less risky than Futura Medical. It trades about 0.2 of its potential returns per unit of risk. Futura Medical is currently generating about -0.04 per unit of risk. If you would invest  1,668  in Halyk Bank of on September 12, 2024 and sell it today you would earn a total of  282.00  from holding Halyk Bank of or generate 16.91% return on investment over 90 days.

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

Halyk Bank of  vs.  Futura Medical

Halyk Bank

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Halyk Bank of are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Halyk Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Futura Medical

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Halyk Bank and Futura Medical

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

The idea behind Halyk Bank of and Futura Medical 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.