Correlation Between Truist Financial and Powszechna Kasa

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

By analyzing existing cross correlation between Truist Financial Corp and Powszechna Kasa Oszczednosci, you can compare the effects of market volatilities on Truist Financial and Powszechna Kasa 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 Truist Financial with a short position of Powszechna Kasa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truist Financial and Powszechna Kasa.

Diversification Opportunities for Truist Financial and Powszechna Kasa

-0.21

Correlation Coefficient

Truist Financial  Powszechna Kasa

Very good diversification

The 3 months correlation between Truist and Powszechna is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Truist Financial Corp and Powszechna Kasa Oszczednosci in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powszechna Kasa Oszc and Truist Financial 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 Truist Financial Corp are associated (or correlated) with Powszechna Kasa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powszechna Kasa Oszc has no effect on the direction of Truist Financial i.e., Truist Financial and Powszechna Kasa go up and down completely randomly.

Pair Corralation between Truist Financial and Powszechna Kasa

Considering the 90-day investment horizon Truist Financial is expected to generate 1.54 times less return on investment than Powszechna Kasa. But when comparing it to its historical volatility, Truist Financial Corp is 3.51 times less risky than Powszechna Kasa. It trades about 0.08 of its potential returns per unit of risk. Powszechna Kasa Oszczednosci is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,450  in Powszechna Kasa Oszczednosci on September 27, 2024 and sell it today you would earn a total of  80.00  from holding Powszechna Kasa Oszczednosci or generate 5.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.4%
Values	Daily Returns

Truist Financial Corp  vs.  Powszechna Kasa Oszczednosci

Truist Financial Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Truist Financial Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Truist Financial is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Powszechna Kasa Oszc

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Powszechna Kasa Oszczednosci are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady forward-looking signals, Powszechna Kasa showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Truist Financial and Powszechna Kasa

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

The idea behind Truist Financial Corp and Powszechna Kasa Oszczednosci 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.

Check out your portfolio center.

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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.