Correlation Between Banco Macro and Itau Unibanco
Can any of the company-specific risk be diversified away by investing in both Banco Macro and Itau Unibanco 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 Itau Unibanco 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 Itau Unibanco Banco, you can compare the effects of market volatilities on Banco Macro and Itau Unibanco 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 Itau Unibanco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Macro and Itau Unibanco.
Diversification Opportunities for Banco Macro and Itau Unibanco
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Banco and Itau is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Banco Macro SA and Itau Unibanco Banco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Itau Unibanco Banco 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 Itau Unibanco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Itau Unibanco Banco has no effect on the direction of Banco Macro i.e., Banco Macro and Itau Unibanco go up and down completely randomly.
Pair Corralation between Banco Macro and Itau Unibanco
Considering the 90-day investment horizon Banco Macro SA is expected to generate 2.03 times more return on investment than Itau Unibanco. However, Banco Macro is 2.03 times more volatile than Itau Unibanco Banco. It trades about 0.19 of its potential returns per unit of risk. Itau Unibanco Banco is currently generating about 0.02 per unit of risk. If you would invest 4,513 in Banco Macro SA on November 3, 2024 and sell it today you would earn a total of 5,432 from holding Banco Macro SA or generate 120.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Macro SA vs. Itau Unibanco Banco
Performance |
| Timeline |
| Banco Macro SA |
| Itau Unibanco Banco |
Banco Macro and Itau Unibanco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Macro and Itau Unibanco
The main advantage of trading using opposite Banco Macro and Itau Unibanco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Macro position performs unexpectedly, Itau Unibanco 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 Itau Unibanco will offset losses from the drop in Itau Unibanco'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 |
| Itau Unibanco vs. Grupo Financiero Galicia | Itau Unibanco vs. Banco Macro SA | Itau Unibanco vs. Banco Santander Brasil | Itau Unibanco vs. Lloyds Banking Group |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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