Correlation Between Banco Bilbao and National Australia
Can any of the company-specific risk be diversified away by investing in both Banco Bilbao and National Australia 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 National Australia 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 National Australia Bank, you can compare the effects of market volatilities on Banco Bilbao and National Australia 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 National Australia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Bilbao and National Australia.
Diversification Opportunities for Banco Bilbao and National Australia
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Banco and National is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Banco Bilbao Vizcaya and National Australia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Australia 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 Vizcaya are associated (or correlated) with National Australia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Australia Bank has no effect on the direction of Banco Bilbao i.e., Banco Bilbao and National Australia go up and down completely randomly.
Pair Corralation between Banco Bilbao and National Australia
Assuming the 90 days horizon Banco Bilbao Vizcaya is expected to under-perform the National Australia. In addition to that, Banco Bilbao is 1.67 times more volatile than National Australia Bank. It trades about -0.22 of its total potential returns per unit of risk. National Australia Bank is currently generating about -0.28 per unit of volatility. If you would invest 2,490 in National Australia Bank on September 13, 2024 and sell it today you would lose (283.00) from holding National Australia Bank or give up 11.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
Banco Bilbao Vizcaya vs. National Australia Bank
Performance |
| Timeline |
| Banco Bilbao Vizcaya |
| National Australia Bank |
Banco Bilbao and National Australia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Bilbao and National Australia
The main advantage of trading using opposite Banco Bilbao and National Australia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Bilbao position performs unexpectedly, National Australia 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 National Australia will offset losses from the drop in National Australia's long position.| Banco Bilbao vs. Bank of America | Banco Bilbao vs. Barclays PLC | Banco Bilbao vs. Bank of America | Banco Bilbao vs. ABN AMRO Bank |
| National Australia vs. National Australia Bank | National Australia vs. China Construction Bank | National Australia vs. Bank of America | National Australia vs. ANZ Group Holdings |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |