Correlation Between OTP Bank and Balancer

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Can any of the company-specific risk be diversified away by investing in both OTP Bank and Balancer 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 OTP Bank and Balancer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OTP Bank Nyrt and Balancer, you can compare the effects of market volatilities on OTP Bank and Balancer 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 OTP Bank with a short position of Balancer. Check out your portfolio center. Please also check ongoing floating volatility patterns of OTP Bank and Balancer.

Diversification Opportunities for OTP Bank and Balancer

-0.33
  Correlation Coefficient

Very good diversification

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

Pair Corralation between OTP Bank and Balancer

If you would invest  553.00  in Balancer on September 10, 2022 and sell it today you would earn a total of  49.00  from holding Balancer or generate 8.86% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy95.45%
ValuesDaily Returns

OTP Bank Nyrt  vs.  Balancer

 Performance (%) 
       Timeline  
OTP Bank Nyrt 
OTPBF Performance
9 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in OTP Bank Nyrt are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental drivers, OTP Bank is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

OTPBF Price Channel

Balancer 
Balancer Performance
0 of 100
Over the last 90 days Balancer has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Balancer is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Balancer Price Channel

OTP Bank and Balancer Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with OTP Bank and Balancer

The main advantage of trading using opposite OTP Bank and Balancer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OTP Bank position performs unexpectedly, Balancer 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 Balancer will offset losses from the drop in Balancer's long position.
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The idea behind OTP Bank Nyrt and Balancer 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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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.

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