Correlation Between Bankinter and Vivenio Residencial
Can any of the company-specific risk be diversified away by investing in both Bankinter and Vivenio Residencial 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 Vivenio Residencial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankinter and Vivenio Residencial SOCIMI, you can compare the effects of market volatilities on Bankinter and Vivenio Residencial 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 Vivenio Residencial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankinter and Vivenio Residencial.
Diversification Opportunities for Bankinter and Vivenio Residencial
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bankinter and Vivenio is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Bankinter and Vivenio Residencial SOCIMI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vivenio Residencial 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 Vivenio Residencial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vivenio Residencial has no effect on the direction of Bankinter i.e., Bankinter and Vivenio Residencial go up and down completely randomly.
Pair Corralation between Bankinter and Vivenio Residencial
Assuming the 90 days trading horizon Bankinter is expected to generate 16.53 times more return on investment than Vivenio Residencial. However, Bankinter is 16.53 times more volatile than Vivenio Residencial SOCIMI. It trades about 0.08 of its potential returns per unit of risk. Vivenio Residencial SOCIMI is currently generating about 0.02 per unit of risk. If you would invest 530.00 in Bankinter on September 12, 2024 and sell it today you would earn a total of 231.00 from holding Bankinter or generate 43.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.44% |
| Values | Daily Returns |
Bankinter vs. Vivenio Residencial SOCIMI
Performance |
| Timeline |
| Bankinter |
| Vivenio Residencial |
Bankinter and Vivenio Residencial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankinter and Vivenio Residencial
The main advantage of trading using opposite Bankinter and Vivenio Residencial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankinter position performs unexpectedly, Vivenio Residencial 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 Vivenio Residencial will offset losses from the drop in Vivenio Residencial's long position.The idea behind Bankinter and Vivenio Residencial SOCIMI 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.| Vivenio Residencial vs. Arteche Lantegi Elkartea | Vivenio Residencial vs. Borges Agricultural Industrial | Vivenio Residencial vs. Cellnex Telecom SA | Vivenio Residencial vs. Home Capital Rentals |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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