Correlation Between JSC Halyk and VIDRALA

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

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

Diversification Opportunities for JSC Halyk and VIDRALA

0.09

Correlation Coefficient

JSC Halyk  VIDRALA

Significant diversification

The 3 months correlation between JSC and VIDRALA is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding JSC Halyk bank and VIDRALA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIDRALA and JSC Halyk 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 JSC Halyk bank are associated (or correlated) with VIDRALA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIDRALA has no effect on the direction of JSC Halyk i.e., JSC Halyk and VIDRALA go up and down completely randomly.

Pair Corralation between JSC Halyk and VIDRALA

Assuming the 90 days trading horizon JSC Halyk bank is expected to generate 3.77 times more return on investment than VIDRALA. However, JSC Halyk is 3.77 times more volatile than VIDRALA. It trades about 0.01 of its potential returns per unit of risk. VIDRALA is currently generating about -0.08 per unit of risk. If you would invest  1,725  in JSC Halyk bank on September 22, 2024 and sell it today you would lose (5.00) from holding JSC Halyk bank or give up 0.29% of portfolio value over 90 days.

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

JSC Halyk bank  vs.  VIDRALA

JSC Halyk bank

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JSC Halyk bank are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, JSC Halyk reported solid returns over the last few months and may actually be approaching a breakup point.

VIDRALA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with JSC Halyk and VIDRALA

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

The idea behind JSC Halyk bank and VIDRALA 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.