Correlation Between Gladstone Investment and BANKINTER ADR
Can any of the company-specific risk be diversified away by investing in both Gladstone Investment and BANKINTER ADR 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 Gladstone Investment and BANKINTER ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Investment and BANKINTER ADR 2007, you can compare the effects of market volatilities on Gladstone Investment and BANKINTER ADR 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 Gladstone Investment with a short position of BANKINTER ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Investment and BANKINTER ADR.
Diversification Opportunities for Gladstone Investment and BANKINTER ADR
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gladstone and BANKINTER is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and BANKINTER ADR 2007 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANKINTER ADR 2007 and Gladstone Investment 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 Gladstone Investment are associated (or correlated) with BANKINTER ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANKINTER ADR 2007 has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and BANKINTER ADR go up and down completely randomly.
Pair Corralation between Gladstone Investment and BANKINTER ADR
Assuming the 90 days horizon Gladstone Investment is expected to under-perform the BANKINTER ADR. But the stock apears to be less risky and, when comparing its historical volatility, Gladstone Investment is 1.36 times less risky than BANKINTER ADR. The stock trades about -0.02 of its potential returns per unit of risk. The BANKINTER ADR 2007 is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 720.00 in BANKINTER ADR 2007 on October 31, 2024 and sell it today you would earn a total of 55.00 from holding BANKINTER ADR 2007 or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Investment vs. BANKINTER ADR 2007
Performance |
| Timeline |
| Gladstone Investment |
| BANKINTER ADR 2007 |
Gladstone Investment and BANKINTER ADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Investment and BANKINTER ADR
The main advantage of trading using opposite Gladstone Investment and BANKINTER ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Investment position performs unexpectedly, BANKINTER ADR 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 BANKINTER ADR will offset losses from the drop in BANKINTER ADR's long position.| Gladstone Investment vs. NTG Nordic Transport | Gladstone Investment vs. Columbia Sportswear | Gladstone Investment vs. SOEDER SPORTFISKE AB | Gladstone Investment vs. Perdoceo Education |
| BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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