Correlation Between BANKINTER ADR and Papa Johns
Can any of the company-specific risk be diversified away by investing in both BANKINTER ADR and Papa Johns 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 Papa Johns 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 Papa Johns International, you can compare the effects of market volatilities on BANKINTER ADR and Papa Johns 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 Papa Johns. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANKINTER ADR and Papa Johns.
Diversification Opportunities for BANKINTER ADR and Papa Johns
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BANKINTER and Papa is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding BANKINTER ADR 2007 and Papa Johns International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Papa Johns International 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 Papa Johns. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Papa Johns International has no effect on the direction of BANKINTER ADR i.e., BANKINTER ADR and Papa Johns go up and down completely randomly.
Pair Corralation between BANKINTER ADR and Papa Johns
Assuming the 90 days horizon BANKINTER ADR 2007 is expected to generate 0.74 times more return on investment than Papa Johns. However, BANKINTER ADR 2007 is 1.34 times less risky than Papa Johns. It trades about 0.09 of its potential returns per unit of risk. Papa Johns International is currently generating about -0.08 per unit of risk. If you would invest 705.00 in BANKINTER ADR 2007 on August 29, 2024 and sell it today you would earn a total of 25.00 from holding BANKINTER ADR 2007 or generate 3.55% 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. Papa Johns International
Performance |
| Timeline |
| BANKINTER ADR 2007 |
| Papa Johns International |
BANKINTER ADR and Papa Johns Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANKINTER ADR and Papa Johns
The main advantage of trading using opposite BANKINTER ADR and Papa Johns positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANKINTER ADR position performs unexpectedly, Papa Johns 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 Papa Johns will offset losses from the drop in Papa Johns' long position.| BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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