Correlation Between BANKINTER ADR and REVO INSURANCE
Can any of the company-specific risk be diversified away by investing in both BANKINTER ADR and REVO INSURANCE 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 BANKINTER ADR and REVO INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANKINTER ADR 2007 and REVO INSURANCE SPA, you can compare the effects of market volatilities on BANKINTER ADR and REVO INSURANCE 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 BANKINTER ADR with a short position of REVO INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANKINTER ADR and REVO INSURANCE.
Diversification Opportunities for BANKINTER ADR and REVO INSURANCE
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BANKINTER and REVO is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding BANKINTER ADR 2007 and REVO INSURANCE SPA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REVO INSURANCE SPA and BANKINTER ADR 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 BANKINTER ADR 2007 are associated (or correlated) with REVO INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REVO INSURANCE SPA has no effect on the direction of BANKINTER ADR i.e., BANKINTER ADR and REVO INSURANCE go up and down completely randomly.
Pair Corralation between BANKINTER ADR and REVO INSURANCE
Assuming the 90 days horizon BANKINTER ADR 2007 is expected to generate 1.9 times more return on investment than REVO INSURANCE. However, BANKINTER ADR is 1.9 times more volatile than REVO INSURANCE SPA. It trades about 0.06 of its potential returns per unit of risk. REVO INSURANCE SPA is currently generating about 0.06 per unit of risk. If you would invest 490.00 in BANKINTER ADR 2007 on August 31, 2024 and sell it today you would earn a total of 225.00 from holding BANKINTER ADR 2007 or generate 45.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANKINTER ADR 2007 vs. REVO INSURANCE SPA
Performance |
| Timeline |
| BANKINTER ADR 2007 |
| REVO INSURANCE SPA |
BANKINTER ADR and REVO INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANKINTER ADR and REVO INSURANCE
The main advantage of trading using opposite BANKINTER ADR and REVO INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANKINTER ADR position performs unexpectedly, REVO INSURANCE 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 REVO INSURANCE will offset losses from the drop in REVO INSURANCE's long position.| BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc |
| REVO INSURANCE vs. Wizz Air Holdings | REVO INSURANCE vs. T MOBILE US | REVO INSURANCE vs. MTI WIRELESS EDGE | REVO INSURANCE vs. Scandinavian Tobacco 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 Managers module to screen money managers from public funds and ETFs managed around the world.
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