Correlation Between EQT AB and Bank Of

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

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

Diversification Opportunities for EQT AB and Bank Of

0.69

Correlation Coefficient

EQT AB  Bank Of

Poor diversification

The 3 months correlation between EQT and Bank is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding EQT AB and The Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Bank and EQT AB 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 EQT AB are associated (or correlated) with Bank Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Bank has no effect on the direction of EQT AB i.e., EQT AB and Bank Of go up and down completely randomly.

Pair Corralation between EQT AB and Bank Of

Assuming the 90 days horizon EQT AB is expected to generate 1.13 times less return on investment than Bank Of. In addition to that, EQT AB is 1.61 times more volatile than The Bank of. It trades about 0.12 of its total potential returns per unit of risk. The Bank of is currently generating about 0.23 per unit of volatility. If you would invest  7,274  in The Bank of on May 7, 2025 and sell it today you would earn a total of  1,465  from holding The Bank of or generate 20.14% return on investment over 90 days.

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

EQT AB  vs.  The Bank of

EQT AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in EQT AB are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, EQT AB reported solid returns over the last few months and may actually be approaching a breakup point.

The Bank

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in The Bank of are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Bank Of reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EQT AB and Bank Of

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

The idea behind EQT AB and The Bank of 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.