Correlation Between BANKINTER ADR and UNIQA INSURANCE
Can any of the company-specific risk be diversified away by investing in both BANKINTER ADR and UNIQA 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 UNIQA 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 UNIQA INSURANCE GR, you can compare the effects of market volatilities on BANKINTER ADR and UNIQA 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 UNIQA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANKINTER ADR and UNIQA INSURANCE.
Diversification Opportunities for BANKINTER ADR and UNIQA INSURANCE
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BANKINTER and UNIQA is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding BANKINTER ADR 2007 and UNIQA INSURANCE GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNIQA INSURANCE GR 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 UNIQA INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNIQA INSURANCE GR has no effect on the direction of BANKINTER ADR i.e., BANKINTER ADR and UNIQA INSURANCE go up and down completely randomly.
Pair Corralation between BANKINTER ADR and UNIQA INSURANCE
Assuming the 90 days horizon BANKINTER ADR 2007 is expected to generate 3.14 times more return on investment than UNIQA INSURANCE. However, BANKINTER ADR is 3.14 times more volatile than UNIQA INSURANCE GR. It trades about 0.35 of its potential returns per unit of risk. UNIQA INSURANCE GR is currently generating about 0.65 per unit of risk. If you would invest 720.00 in BANKINTER ADR 2007 on October 30, 2024 and sell it today you would earn a total of 70.00 from holding BANKINTER ADR 2007 or generate 9.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANKINTER ADR 2007 vs. UNIQA INSURANCE GR
Performance |
| Timeline |
| BANKINTER ADR 2007 |
| UNIQA INSURANCE GR |
BANKINTER ADR and UNIQA INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANKINTER ADR and UNIQA INSURANCE
The main advantage of trading using opposite BANKINTER ADR and UNIQA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANKINTER ADR position performs unexpectedly, UNIQA 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 UNIQA INSURANCE will offset losses from the drop in UNIQA INSURANCE's long position.| BANKINTER ADR vs. PennantPark Investment | BANKINTER ADR vs. Gladstone Investment | BANKINTER ADR vs. DATANG INTL POW | BANKINTER ADR vs. China Datang |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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