Correlation Between Banco Do and Intesa Sanpaolo
Can any of the company-specific risk be diversified away by investing in both Banco Do and Intesa Sanpaolo 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 Do and Intesa Sanpaolo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Do Brasil and Intesa Sanpaolo SpA, you can compare the effects of market volatilities on Banco Do and Intesa Sanpaolo 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 Do with a short position of Intesa Sanpaolo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Do and Intesa Sanpaolo.
Diversification Opportunities for Banco Do and Intesa Sanpaolo
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Banco and Intesa is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Banco Do Brasil and Intesa Sanpaolo SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intesa Sanpaolo SpA and Banco Do 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 Do Brasil are associated (or correlated) with Intesa Sanpaolo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intesa Sanpaolo SpA has no effect on the direction of Banco Do i.e., Banco Do and Intesa Sanpaolo go up and down completely randomly.
Pair Corralation between Banco Do and Intesa Sanpaolo
Assuming the 90 days horizon Banco Do Brasil is expected to under-perform the Intesa Sanpaolo. But the pink sheet apears to be less risky and, when comparing its historical volatility, Banco Do Brasil is 1.02 times less risky than Intesa Sanpaolo. The pink sheet trades about -0.17 of its potential returns per unit of risk. The Intesa Sanpaolo SpA is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 2,508 in Intesa Sanpaolo SpA on August 24, 2024 and sell it today you would lose (43.00) from holding Intesa Sanpaolo SpA or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Do Brasil vs. Intesa Sanpaolo SpA
Performance |
| Timeline |
| Banco Do Brasil |
| Intesa Sanpaolo SpA |
Banco Do and Intesa Sanpaolo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Do and Intesa Sanpaolo
The main advantage of trading using opposite Banco Do and Intesa Sanpaolo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Do position performs unexpectedly, Intesa Sanpaolo 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 Intesa Sanpaolo will offset losses from the drop in Intesa Sanpaolo's long position.| Banco Do vs. BB Seguridade Participacoes | Banco Do vs. Banco Santander Brasil | Banco Do vs. Centrais Electricas Brasileiras | Banco Do vs. Itau Unibanco Banco |
| Intesa Sanpaolo vs. Pioneer Floating Rate | Intesa Sanpaolo vs. The Gabelli Equity | Intesa Sanpaolo vs. Pioneer Municipal High | Intesa Sanpaolo vs. Nuveen Global High |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |