Correlation Between Banco Bradesco and Triumph Financial
Can any of the company-specific risk be diversified away by investing in both Banco Bradesco and Triumph 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 Banco Bradesco and Triumph Financial 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 Triumph Financial, you can compare the effects of market volatilities on Banco Bradesco and Triumph 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 Banco Bradesco with a short position of Triumph Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Bradesco and Triumph Financial.
Diversification Opportunities for Banco Bradesco and Triumph Financial
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Banco and Triumph is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Banco Bradesco SA and Triumph Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triumph Financial 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 Triumph Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triumph Financial has no effect on the direction of Banco Bradesco i.e., Banco Bradesco and Triumph Financial go up and down completely randomly.
Pair Corralation between Banco Bradesco and Triumph Financial
Considering the 90-day investment horizon Banco Bradesco is expected to generate 1.21 times less return on investment than Triumph Financial. In addition to that, Banco Bradesco is 1.17 times more volatile than Triumph Financial. It trades about 0.01 of its total potential returns per unit of risk. Triumph Financial is currently generating about 0.02 per unit of volatility. If you would invest 2,121 in Triumph Financial on August 24, 2024 and sell it today you would earn a total of 187.00 from holding Triumph Financial or generate 8.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Banco Bradesco SA vs. Triumph Financial
Performance |
| Timeline |
| Banco Bradesco SA |
| Triumph Financial |
Banco Bradesco and Triumph Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Bradesco and Triumph Financial
The main advantage of trading using opposite Banco Bradesco and Triumph Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Bradesco position performs unexpectedly, Triumph 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 Triumph Financial will offset losses from the drop in Triumph Financial'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 |
| Triumph Financial vs. Banco Bradesco SA | Triumph Financial vs. Itau Unibanco Banco | Triumph Financial vs. Banco Santander Brasil | Triumph Financial vs. Western Alliance 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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