Correlation Between Panasonic Corp and OneSavings Bank

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

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

Diversification Opportunities for Panasonic Corp and OneSavings Bank

0.43

Correlation Coefficient

Panasonic Corp  OneSavings Bank

Very weak diversification

The 3 months correlation between Panasonic and OneSavings is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Panasonic Corp and OneSavings Bank PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneSavings Bank PLC and Panasonic Corp 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 Panasonic Corp are associated (or correlated) with OneSavings Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneSavings Bank PLC has no effect on the direction of Panasonic Corp i.e., Panasonic Corp and OneSavings Bank go up and down completely randomly.

Pair Corralation between Panasonic Corp and OneSavings Bank

Assuming the 90 days trading horizon Panasonic Corp is expected to generate 1.59 times more return on investment than OneSavings Bank. However, Panasonic Corp is 1.59 times more volatile than OneSavings Bank PLC. It trades about 0.29 of its potential returns per unit of risk. OneSavings Bank PLC is currently generating about 0.1 per unit of risk. If you would invest  120,151  in Panasonic Corp on September 13, 2024 and sell it today you would earn a total of  30,549  from holding Panasonic Corp or generate 25.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	51.56%
Values	Daily Returns

Panasonic Corp  vs.  OneSavings Bank PLC

Panasonic Corp

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Panasonic Corp are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Panasonic Corp unveiled solid returns over the last few months and may actually be approaching a breakup point.

OneSavings Bank PLC

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in OneSavings Bank PLC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, OneSavings Bank may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Panasonic Corp and OneSavings Bank

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

The idea behind Panasonic Corp and OneSavings Bank PLC 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.