Correlation Between Wiener Privatbank and Oberbank

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

By analyzing existing cross correlation between Wiener Privatbank SE and Oberbank AG, you can compare the effects of market volatilities on Wiener Privatbank and Oberbank 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 Wiener Privatbank with a short position of Oberbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wiener Privatbank and Oberbank.

Diversification Opportunities for Wiener Privatbank and Oberbank

-0.34

Correlation Coefficient

Wiener Privatbank  Oberbank

Very good diversification

The 3 months correlation between Wiener and Oberbank is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Wiener Privatbank SE and Oberbank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oberbank AG and Wiener Privatbank 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 Wiener Privatbank SE are associated (or correlated) with Oberbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oberbank AG has no effect on the direction of Wiener Privatbank i.e., Wiener Privatbank and Oberbank go up and down completely randomly.

Pair Corralation between Wiener Privatbank and Oberbank

Assuming the 90 days trading horizon Wiener Privatbank SE is expected to under-perform the Oberbank. In addition to that, Wiener Privatbank is 2.5 times more volatile than Oberbank AG. It trades about -0.25 of its total potential returns per unit of risk. Oberbank AG is currently generating about 0.0 per unit of volatility. If you would invest  7,000  in Oberbank AG on September 17, 2024 and sell it today you would earn a total of  0.00  from holding Oberbank AG or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Wiener Privatbank SE  vs.  Oberbank AG

Wiener Privatbank

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wiener Privatbank SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental drivers, Wiener Privatbank is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Oberbank AG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oberbank AG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Oberbank is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Wiener Privatbank and Oberbank

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

The idea behind Wiener Privatbank SE and Oberbank AG 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.