Correlation Between Banco Bilbao and Canadian Imperial
Can any of the company-specific risk be diversified away by investing in both Banco Bilbao and Canadian Imperial 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 Canadian Imperial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Bilbao Viscaya and Canadian Imperial Bank, you can compare the effects of market volatilities on Banco Bilbao and Canadian Imperial 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 Canadian Imperial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Bilbao and Canadian Imperial.
Diversification Opportunities for Banco Bilbao and Canadian Imperial
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Banco and Canadian is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Banco Bilbao Viscaya and Canadian Imperial Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Imperial Bank 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 Viscaya are associated (or correlated) with Canadian Imperial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Imperial Bank has no effect on the direction of Banco Bilbao i.e., Banco Bilbao and Canadian Imperial go up and down completely randomly.
Pair Corralation between Banco Bilbao and Canadian Imperial
Given the investment horizon of 90 days Banco Bilbao Viscaya is expected to generate 1.58 times more return on investment than Canadian Imperial. However, Banco Bilbao is 1.58 times more volatile than Canadian Imperial Bank. It trades about 0.08 of its potential returns per unit of risk. Canadian Imperial Bank is currently generating about 0.13 per unit of risk. If you would invest 972.00 in Banco Bilbao Viscaya on September 12, 2024 and sell it today you would earn a total of 29.00 from holding Banco Bilbao Viscaya or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Bilbao Viscaya vs. Canadian Imperial Bank
Performance |
| Timeline |
| Banco Bilbao Viscaya |
| Canadian Imperial Bank |
Banco Bilbao and Canadian Imperial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Bilbao and Canadian Imperial
The main advantage of trading using opposite Banco Bilbao and Canadian Imperial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Bilbao position performs unexpectedly, Canadian Imperial 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 Canadian Imperial will offset losses from the drop in Canadian Imperial's long position.| Banco Bilbao vs. Barclays PLC ADR | Banco Bilbao vs. ING Group NV | Banco Bilbao vs. Banco Santander SA | Banco Bilbao vs. HSBC Holdings PLC |
| Canadian Imperial vs. Bank of America | Canadian Imperial vs. Victory Integrity Smallmid Cap | Canadian Imperial vs. Hilton Worldwide Holdings | Canadian Imperial vs. NVIDIA |
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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