Correlation Between Banco Macro and Banco Bradesco
Can any of the company-specific risk be diversified away by investing in both Banco Macro and Banco Bradesco 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 Macro and Banco Bradesco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Macro SA and Banco Bradesco SA, you can compare the effects of market volatilities on Banco Macro and Banco Bradesco 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 Macro with a short position of Banco Bradesco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Macro and Banco Bradesco.
Diversification Opportunities for Banco Macro and Banco Bradesco
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Banco and Banco is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Banco Macro SA and Banco Bradesco SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Bradesco SA and Banco Macro 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 Macro SA are associated (or correlated) with Banco Bradesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Bradesco SA has no effect on the direction of Banco Macro i.e., Banco Macro and Banco Bradesco go up and down completely randomly.
Pair Corralation between Banco Macro and Banco Bradesco
Considering the 90-day investment horizon Banco Macro SA is expected to generate 2.02 times more return on investment than Banco Bradesco. However, Banco Macro is 2.02 times more volatile than Banco Bradesco SA. It trades about 0.05 of its potential returns per unit of risk. Banco Bradesco SA is currently generating about -0.4 per unit of risk. If you would invest 7,911 in Banco Macro SA on August 27, 2024 and sell it today you would earn a total of 165.00 from holding Banco Macro SA or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Macro SA vs. Banco Bradesco SA
Performance |
| Timeline |
| Banco Macro SA |
| Banco Bradesco SA |
Banco Macro and Banco Bradesco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Macro and Banco Bradesco
The main advantage of trading using opposite Banco Macro and Banco Bradesco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Macro position performs unexpectedly, Banco Bradesco 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 Banco Bradesco will offset losses from the drop in Banco Bradesco's long position.| Banco Macro vs. Grupo Supervielle SA | Banco Macro vs. BBVA Banco Frances | Banco Macro vs. Banco Bradesco SA | Banco Macro vs. Itau Unibanco Banco |
| Banco Bradesco vs. Banco Santander Brasil | Banco Bradesco vs. Banco Macro SA | Banco Bradesco vs. Lloyds Banking Group | Banco Bradesco vs. Grupo Financiero Galicia |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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