Correlation Between Banco Bilbao and Cox ABG
Can any of the company-specific risk be diversified away by investing in both Banco Bilbao and Cox ABG 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 Bilbao and Cox ABG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Bilbao Vizcaya and Cox ABG Group, you can compare the effects of market volatilities on Banco Bilbao and Cox ABG 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 Bilbao with a short position of Cox ABG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Bilbao and Cox ABG.
Diversification Opportunities for Banco Bilbao and Cox ABG
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Banco and Cox is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Banco Bilbao Vizcaya and Cox ABG Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cox ABG Group and Banco Bilbao 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 Bilbao Vizcaya are associated (or correlated) with Cox ABG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cox ABG Group has no effect on the direction of Banco Bilbao i.e., Banco Bilbao and Cox ABG go up and down completely randomly.
Pair Corralation between Banco Bilbao and Cox ABG
Assuming the 90 days trading horizon Banco Bilbao Vizcaya is expected to generate 0.79 times more return on investment than Cox ABG. However, Banco Bilbao Vizcaya is 1.26 times less risky than Cox ABG. It trades about 0.08 of its potential returns per unit of risk. Cox ABG Group is currently generating about -0.03 per unit of risk. If you would invest 616.00 in Banco Bilbao Vizcaya on November 5, 2024 and sell it today you would earn a total of 489.00 from holding Banco Bilbao Vizcaya or generate 79.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 10.74% |
| Values | Daily Returns |
Banco Bilbao Vizcaya vs. Cox ABG Group
Performance |
| Timeline |
| Banco Bilbao Vizcaya |
| Cox ABG Group |
Banco Bilbao and Cox ABG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Bilbao and Cox ABG
The main advantage of trading using opposite Banco Bilbao and Cox ABG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Bilbao position performs unexpectedly, Cox ABG 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 Cox ABG will offset losses from the drop in Cox ABG's long position.| Banco Bilbao vs. Banco Santander | Banco Bilbao vs. Repsol | Banco Bilbao vs. Telefonica | Banco Bilbao vs. Iberdrola SA |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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