Correlation Between Exchange Bank and Power Of

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

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

Diversification Opportunities for Exchange Bank and Power Of

0.05

Correlation Coefficient

Exchange Bank  Power Of

Significant diversification

The 3 months correlation between Exchange and Power is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Exchange Bank and Power of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Of and Exchange 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 Exchange Bank are associated (or correlated) with Power Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Of has no effect on the direction of Exchange Bank i.e., Exchange Bank and Power Of go up and down completely randomly.

Pair Corralation between Exchange Bank and Power Of

Given the investment horizon of 90 days Exchange Bank is expected to generate 39.18 times less return on investment than Power Of. In addition to that, Exchange Bank is 1.1 times more volatile than Power of. It trades about 0.0 of its total potential returns per unit of risk. Power of is currently generating about 0.19 per unit of volatility. If you would invest  3,576  in Power of on May 13, 2025 and sell it today you would earn a total of  617.00  from holding Power of or generate 17.25% return on investment over 90 days.

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

Exchange Bank  vs.  Power of

Exchange Bank

Risk-Adjusted Performance

Weakest

Over the last 90 days Exchange Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Exchange Bank is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Power Of

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Power of are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, Power Of reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Exchange Bank and Power Of

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

The idea behind Exchange Bank and Power 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.