Correlation Between Intuitive Investments and State Bank

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

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

Diversification Opportunities for Intuitive Investments and State Bank

-0.7

Correlation Coefficient

Intuitive Investments  State Bank

Excellent diversification

The 3 months correlation between Intuitive and State is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Investments Group and State Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Bank and Intuitive Investments 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 Intuitive Investments Group are associated (or correlated) with State Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Bank has no effect on the direction of Intuitive Investments i.e., Intuitive Investments and State Bank go up and down completely randomly.

Pair Corralation between Intuitive Investments and State Bank

Assuming the 90 days trading horizon Intuitive Investments Group is expected to under-perform the State Bank. But the stock apears to be less risky and, when comparing its historical volatility, Intuitive Investments Group is 2.44 times less risky than State Bank. The stock trades about -0.08 of its potential returns per unit of risk. The State Bank of is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  9,580  in State Bank of on September 19, 2024 and sell it today you would earn a total of  390.00  from holding State Bank of or generate 4.07% return on investment over 90 days.

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

Intuitive Investments Group  vs.  State Bank of

Intuitive Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intuitive Investments Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

State Bank

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in State Bank of are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, State Bank is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Intuitive Investments and State Bank

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

The idea behind Intuitive Investments Group and State Bank of 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.