Correlation Between Banco Bradesco and Comerica
Can any of the company-specific risk be diversified away by investing in both Banco Bradesco and Comerica 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 Comerica 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 Comerica, you can compare the effects of market volatilities on Banco Bradesco and Comerica 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 Comerica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Bradesco and Comerica.
Diversification Opportunities for Banco Bradesco and Comerica
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Banco and Comerica is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Banco Bradesco SA and Comerica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comerica 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 Comerica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comerica has no effect on the direction of Banco Bradesco i.e., Banco Bradesco and Comerica go up and down completely randomly.
Pair Corralation between Banco Bradesco and Comerica
Considering the 90-day investment horizon Banco Bradesco is expected to generate 2.9 times less return on investment than Comerica. But when comparing it to its historical volatility, Banco Bradesco SA is 1.36 times less risky than Comerica. It trades about 0.01 of its potential returns per unit of risk. Comerica is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 5,932 in Comerica on August 24, 2024 and sell it today you would earn a total of 1,177 from holding Comerica or generate 19.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Bradesco SA vs. Comerica
Performance |
| Timeline |
| Banco Bradesco SA |
| Comerica |
Banco Bradesco and Comerica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Bradesco and Comerica
The main advantage of trading using opposite Banco Bradesco and Comerica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Bradesco position performs unexpectedly, Comerica 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 Comerica will offset losses from the drop in Comerica's long position.| Banco Bradesco vs. Banco Santander Brasil | Banco Bradesco vs. Banco Macro SA | Banco Bradesco vs. Lloyds Banking Group | Banco Bradesco vs. Grupo Financiero Galicia |
| Comerica vs. Western Alliance Bancorporation | Comerica vs. KeyCorp | Comerica vs. Truist Financial Corp | Comerica vs. Zions Bancorporation |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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