Correlation Between BANKINTER ADR and Kaiser Aluminum
Can any of the company-specific risk be diversified away by investing in both BANKINTER ADR and Kaiser Aluminum 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 Kaiser Aluminum 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 Kaiser Aluminum, you can compare the effects of market volatilities on BANKINTER ADR and Kaiser Aluminum 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 Kaiser Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANKINTER ADR and Kaiser Aluminum.
Diversification Opportunities for BANKINTER ADR and Kaiser Aluminum
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BANKINTER and Kaiser is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding BANKINTER ADR 2007 and Kaiser Aluminum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaiser Aluminum 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 Kaiser Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaiser Aluminum has no effect on the direction of BANKINTER ADR i.e., BANKINTER ADR and Kaiser Aluminum go up and down completely randomly.
Pair Corralation between BANKINTER ADR and Kaiser Aluminum
Assuming the 90 days horizon BANKINTER ADR 2007 is expected to generate 0.97 times more return on investment than Kaiser Aluminum. However, BANKINTER ADR 2007 is 1.03 times less risky than Kaiser Aluminum. It trades about 0.09 of its potential returns per unit of risk. Kaiser Aluminum is currently generating about -0.3 per unit of risk. If you would invest 698.00 in BANKINTER ADR 2007 on September 23, 2024 and sell it today you would earn a total of 22.00 from holding BANKINTER ADR 2007 or generate 3.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANKINTER ADR 2007 vs. Kaiser Aluminum
Performance |
| Timeline |
| BANKINTER ADR 2007 |
| Kaiser Aluminum |
BANKINTER ADR and Kaiser Aluminum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANKINTER ADR and Kaiser Aluminum
The main advantage of trading using opposite BANKINTER ADR and Kaiser Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANKINTER ADR position performs unexpectedly, Kaiser Aluminum 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 Kaiser Aluminum will offset losses from the drop in Kaiser Aluminum's long position.| BANKINTER ADR vs. American Homes 4 | BANKINTER ADR vs. Autohome ADR | BANKINTER ADR vs. bet at home AG | BANKINTER ADR vs. GAMING FAC SA |
| Kaiser Aluminum vs. Norsk Hydro ASA | Kaiser Aluminum vs. Norsk Hydro ASA | Kaiser Aluminum vs. Aluminum of | Kaiser Aluminum vs. Alcoa Corp |
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 Stocks Directory module to find actively traded stocks across global markets.
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