Correlation Between CaixaBank and Lloyds Banking
Can any of the company-specific risk be diversified away by investing in both CaixaBank and Lloyds Banking 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 CaixaBank and Lloyds Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CaixaBank SA and Lloyds Banking Group, you can compare the effects of market volatilities on CaixaBank and Lloyds Banking 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 CaixaBank with a short position of Lloyds Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of CaixaBank and Lloyds Banking.
Diversification Opportunities for CaixaBank and Lloyds Banking
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between CaixaBank and Lloyds is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding CaixaBank SA and Lloyds Banking Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lloyds Banking Group and CaixaBank 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 CaixaBank SA are associated (or correlated) with Lloyds Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lloyds Banking Group has no effect on the direction of CaixaBank i.e., CaixaBank and Lloyds Banking go up and down completely randomly.
Pair Corralation between CaixaBank and Lloyds Banking
Assuming the 90 days trading horizon CaixaBank SA is expected to generate 1.01 times more return on investment than Lloyds Banking. However, CaixaBank is 1.01 times more volatile than Lloyds Banking Group. It trades about 0.29 of its potential returns per unit of risk. Lloyds Banking Group is currently generating about 0.25 per unit of risk. If you would invest 521.00 in CaixaBank SA on November 1, 2024 and sell it today you would earn a total of 67.00 from holding CaixaBank SA or generate 12.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CaixaBank SA vs. Lloyds Banking Group
Performance |
| Timeline |
| CaixaBank SA |
| Lloyds Banking Group |
CaixaBank and Lloyds Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CaixaBank and Lloyds Banking
The main advantage of trading using opposite CaixaBank and Lloyds Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CaixaBank position performs unexpectedly, Lloyds Banking 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 Lloyds Banking will offset losses from the drop in Lloyds Banking's long position.| CaixaBank vs. Siemens Healthineers AG | CaixaBank vs. Austevoll Seafood ASA | CaixaBank vs. Planet Fitness | CaixaBank vs. TYSON FOODS A |
| Lloyds Banking vs. Singapore Telecommunications Limited | Lloyds Banking vs. Comba Telecom Systems | Lloyds Banking vs. CVR Medical Corp | Lloyds Banking vs. Entravision Communications |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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