Correlation Between CaixaBank and Crdit Agricole
Can any of the company-specific risk be diversified away by investing in both CaixaBank and Crdit Agricole 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 Crdit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CaixaBank SA and Crdit Agricole SA, you can compare the effects of market volatilities on CaixaBank and Crdit Agricole 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 Crdit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of CaixaBank and Crdit Agricole.
Diversification Opportunities for CaixaBank and Crdit Agricole
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CaixaBank and Crdit is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding CaixaBank SA and Crdit Agricole SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crdit Agricole SA 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 Crdit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crdit Agricole SA has no effect on the direction of CaixaBank i.e., CaixaBank and Crdit Agricole go up and down completely randomly.
Pair Corralation between CaixaBank and Crdit Agricole
Assuming the 90 days trading horizon CaixaBank SA is expected to generate 0.92 times more return on investment than Crdit Agricole. However, CaixaBank SA is 1.09 times less risky than Crdit Agricole. It trades about 0.07 of its potential returns per unit of risk. Crdit Agricole SA is currently generating about 0.02 per unit of risk. If you would invest 502.00 in CaixaBank SA on September 27, 2024 and sell it today you would earn a total of 10.00 from holding CaixaBank SA or generate 1.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CaixaBank SA vs. Crdit Agricole SA
Performance |
| Timeline |
| CaixaBank SA |
| Crdit Agricole SA |
CaixaBank and Crdit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CaixaBank and Crdit Agricole
The main advantage of trading using opposite CaixaBank and Crdit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CaixaBank position performs unexpectedly, Crdit Agricole 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 Crdit Agricole will offset losses from the drop in Crdit Agricole's long position.| CaixaBank vs. BNP Paribas SA | CaixaBank vs. BNP PARIBAS ADR | CaixaBank vs. Intesa Sanpaolo SpA | CaixaBank vs. Lloyds Banking Group |
| Crdit Agricole vs. BNP Paribas SA | Crdit Agricole vs. BNP PARIBAS ADR | Crdit Agricole vs. Intesa Sanpaolo SpA | Crdit Agricole vs. Lloyds Banking Group |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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