Correlation Between BANKINTER ADR and Regions Financial
Can any of the company-specific risk be diversified away by investing in both BANKINTER ADR and Regions Financial 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 Regions Financial 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 Regions Financial, you can compare the effects of market volatilities on BANKINTER ADR and Regions Financial 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 Regions Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANKINTER ADR and Regions Financial.
Diversification Opportunities for BANKINTER ADR and Regions Financial
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between BANKINTER and Regions is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding BANKINTER ADR 2007 and Regions Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regions Financial 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 Regions Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regions Financial has no effect on the direction of BANKINTER ADR i.e., BANKINTER ADR and Regions Financial go up and down completely randomly.
Pair Corralation between BANKINTER ADR and Regions Financial
Assuming the 90 days horizon BANKINTER ADR is expected to generate 1.15 times less return on investment than Regions Financial. In addition to that, BANKINTER ADR is 1.18 times more volatile than Regions Financial. It trades about 0.06 of its total potential returns per unit of risk. Regions Financial is currently generating about 0.08 per unit of volatility. If you would invest 1,609 in Regions Financial on August 31, 2024 and sell it today you would earn a total of 971.00 from holding Regions Financial or generate 60.35% 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. Regions Financial
Performance |
| Timeline |
| BANKINTER ADR 2007 |
| Regions Financial |
BANKINTER ADR and Regions Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANKINTER ADR and Regions Financial
The main advantage of trading using opposite BANKINTER ADR and Regions Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANKINTER ADR position performs unexpectedly, Regions Financial 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 Regions Financial will offset losses from the drop in Regions Financial's long position.| BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc | BANKINTER ADR vs. Apple Inc |
| Regions Financial vs. MOLSON RS BEVERAGE | Regions Financial vs. AOI Electronics Co | Regions Financial vs. Benchmark Electronics | Regions Financial vs. UMC Electronics Co |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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