Correlation Between Bankinter and Parlem Telecom
Can any of the company-specific risk be diversified away by investing in both Bankinter and Parlem Telecom 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 Bankinter and Parlem Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankinter and Parlem Telecom Companyia, you can compare the effects of market volatilities on Bankinter and Parlem Telecom 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 Bankinter with a short position of Parlem Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankinter and Parlem Telecom.
Diversification Opportunities for Bankinter and Parlem Telecom
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bankinter and Parlem is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Bankinter and Parlem Telecom Companyia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parlem Telecom ia and Bankinter 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 Bankinter are associated (or correlated) with Parlem Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parlem Telecom ia has no effect on the direction of Bankinter i.e., Bankinter and Parlem Telecom go up and down completely randomly.
Pair Corralation between Bankinter and Parlem Telecom
Assuming the 90 days trading horizon Bankinter is expected to generate 0.83 times more return on investment than Parlem Telecom. However, Bankinter is 1.21 times less risky than Parlem Telecom. It trades about 0.17 of its potential returns per unit of risk. Parlem Telecom Companyia is currently generating about -0.03 per unit of risk. If you would invest 706.00 in Bankinter on October 25, 2024 and sell it today you would earn a total of 114.00 from holding Bankinter or generate 16.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Bankinter vs. Parlem Telecom Companyia
Performance |
| Timeline |
| Bankinter |
| Parlem Telecom ia |
Bankinter and Parlem Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankinter and Parlem Telecom
The main advantage of trading using opposite Bankinter and Parlem Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankinter position performs unexpectedly, Parlem Telecom 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 Parlem Telecom will offset losses from the drop in Parlem Telecom's long position.The idea behind Bankinter and Parlem Telecom Companyia pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Parlem Telecom vs. Bankinter | Parlem Telecom vs. Technomeca Aerospace SA | Parlem Telecom vs. Techo Hogar SOCIMI, | Parlem Telecom vs. Atresmedia Corporacin de |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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