Correlation Between PARKEN Sport and BankInvest Hjt

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

By analyzing existing cross correlation between PARKEN Sport Entertainment and BankInvest Hjt Udbytte, you can compare the effects of market volatilities on PARKEN Sport and BankInvest Hjt 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 PARKEN Sport with a short position of BankInvest Hjt. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and BankInvest Hjt.

Diversification Opportunities for PARKEN Sport and BankInvest Hjt

-0.33

Correlation Coefficient

PARKEN Sport  BankInvest Hjt

Very good diversification

The 3 months correlation between PARKEN and BankInvest is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and BankInvest Hjt Udbytte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BankInvest Hjt Udbytte and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with BankInvest Hjt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BankInvest Hjt Udbytte has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and BankInvest Hjt go up and down completely randomly.

Pair Corralation between PARKEN Sport and BankInvest Hjt

Assuming the 90 days trading horizon PARKEN Sport Entertainment is expected to generate 2.8 times more return on investment than BankInvest Hjt. However, PARKEN Sport is 2.8 times more volatile than BankInvest Hjt Udbytte. It trades about 0.08 of its potential returns per unit of risk. BankInvest Hjt Udbytte is currently generating about -0.03 per unit of risk. If you would invest  12,200  in PARKEN Sport Entertainment on October 11, 2024 and sell it today you would earn a total of  1,150  from holding PARKEN Sport Entertainment or generate 9.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

PARKEN Sport Entertainment  vs.  BankInvest Hjt Udbytte

PARKEN Sport Enterta

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in PARKEN Sport Entertainment are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, PARKEN Sport may actually be approaching a critical reversion point that can send shares even higher in February 2025.

BankInvest Hjt Udbytte

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with PARKEN Sport and BankInvest Hjt

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

The idea behind PARKEN Sport Entertainment and BankInvest Hjt Udbytte 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.