Correlation Between Banco Bradesco and Bangkok Bank
Can any of the company-specific risk be diversified away by investing in both Banco Bradesco and Bangkok Bank 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 Banco Bradesco and Bangkok Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Bradesco SA and Bangkok Bank Public, you can compare the effects of market volatilities on Banco Bradesco and Bangkok Bank 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 Banco Bradesco with a short position of Bangkok Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Bradesco and Bangkok Bank.
Diversification Opportunities for Banco Bradesco and Bangkok Bank
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Banco and Bangkok is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Banco Bradesco SA and Bangkok Bank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Bank Public and Banco Bradesco 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 Banco Bradesco SA are associated (or correlated) with Bangkok Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Bank Public has no effect on the direction of Banco Bradesco i.e., Banco Bradesco and Bangkok Bank go up and down completely randomly.
Pair Corralation between Banco Bradesco and Bangkok Bank
Considering the 90-day investment horizon Banco Bradesco SA is expected to under-perform the Bangkok Bank. But the stock apears to be less risky and, when comparing its historical volatility, Banco Bradesco SA is 1.04 times less risky than Bangkok Bank. The stock trades about -0.32 of its potential returns per unit of risk. The Bangkok Bank Public is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 380.00 in Bangkok Bank Public on September 23, 2024 and sell it today you would lose (8.00) from holding Bangkok Bank Public or give up 2.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Bradesco SA vs. Bangkok Bank Public
Performance |
| Timeline |
| Banco Bradesco SA |
| Bangkok Bank Public |
Banco Bradesco and Bangkok Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Bradesco and Bangkok Bank
The main advantage of trading using opposite Banco Bradesco and Bangkok Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Bradesco position performs unexpectedly, Bangkok Bank 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 Bangkok Bank will offset losses from the drop in Bangkok Bank's long position.| Banco Bradesco vs. Shinhan Financial Group | Banco Bradesco vs. KB Financial Group | Banco Bradesco vs. Banco De Chile | Banco Bradesco vs. Orix Corp Ads |
| Bangkok Bank vs. Banco Bradesco SA | Bangkok Bank vs. Itau Unibanco Banco | Bangkok Bank vs. Lloyds Banking Group | Bangkok Bank vs. Deutsche Bank AG |
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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