Correlation Between BBVA Banco and LION ONE
Can any of the company-specific risk be diversified away by investing in both BBVA Banco and LION ONE 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 BBVA Banco and LION ONE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BBVA Banco Frances and LION ONE METALS, you can compare the effects of market volatilities on BBVA Banco and LION ONE 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 BBVA Banco with a short position of LION ONE. Check out your portfolio center. Please also check ongoing floating volatility patterns of BBVA Banco and LION ONE.
Diversification Opportunities for BBVA Banco and LION ONE
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between BBVA and LION is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding BBVA Banco Frances and LION ONE METALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LION ONE METALS and BBVA Banco 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 BBVA Banco Frances are associated (or correlated) with LION ONE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LION ONE METALS has no effect on the direction of BBVA Banco i.e., BBVA Banco and LION ONE go up and down completely randomly.
Pair Corralation between BBVA Banco and LION ONE
Assuming the 90 days horizon BBVA Banco Frances is expected to generate 1.29 times more return on investment than LION ONE. However, BBVA Banco is 1.29 times more volatile than LION ONE METALS. It trades about 0.29 of its potential returns per unit of risk. LION ONE METALS is currently generating about -0.05 per unit of risk. If you would invest 1,190 in BBVA Banco Frances on September 1, 2024 and sell it today you would earn a total of 360.00 from holding BBVA Banco Frances or generate 30.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
BBVA Banco Frances vs. LION ONE METALS
Performance |
| Timeline |
| BBVA Banco Frances |
| LION ONE METALS |
BBVA Banco and LION ONE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BBVA Banco and LION ONE
The main advantage of trading using opposite BBVA Banco and LION ONE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BBVA Banco position performs unexpectedly, LION ONE 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 LION ONE will offset losses from the drop in LION ONE's long position.| BBVA Banco vs. National Beverage Corp | BBVA Banco vs. SIDETRADE EO 1 | BBVA Banco vs. National Retail Properties | BBVA Banco vs. SALESFORCE INC CDR |
| LION ONE vs. Corporate Office Properties | LION ONE vs. Eagle Materials | LION ONE vs. Plastic Omnium | LION ONE vs. KENEDIX OFFICE INV |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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