Correlation Between Banco De and Barclays PLC
Can any of the company-specific risk be diversified away by investing in both Banco De and Barclays PLC 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 De and Barclays PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco de Sabadell and Barclays PLC, you can compare the effects of market volatilities on Banco De and Barclays PLC 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 De with a short position of Barclays PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco De and Barclays PLC.
Diversification Opportunities for Banco De and Barclays PLC
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Banco and Barclays is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Banco de Sabadell and Barclays PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays PLC and Banco De 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 de Sabadell are associated (or correlated) with Barclays PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays PLC has no effect on the direction of Banco De i.e., Banco De and Barclays PLC go up and down completely randomly.
Pair Corralation between Banco De and Barclays PLC
Assuming the 90 days horizon Banco de Sabadell is expected to under-perform the Barclays PLC. But the pink sheet apears to be less risky and, when comparing its historical volatility, Banco de Sabadell is 1.16 times less risky than Barclays PLC. The pink sheet trades about -0.07 of its potential returns per unit of risk. The Barclays PLC is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 310.00 in Barclays PLC on August 28, 2024 and sell it today you would earn a total of 21.00 from holding Barclays PLC or generate 6.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco de Sabadell vs. Barclays PLC
Performance |
| Timeline |
| Banco de Sabadell |
| Barclays PLC |
Banco De and Barclays PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco De and Barclays PLC
The main advantage of trading using opposite Banco De and Barclays PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco De position performs unexpectedly, Barclays PLC 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 Barclays PLC will offset losses from the drop in Barclays PLC's long position.| Banco De vs. ANZ Group Holdings | Banco De vs. Agricultural Bank | Banco De vs. Industrial and Commercial | Banco De vs. Bank of America |
| Barclays PLC vs. ABN AMRO Bank | Barclays PLC vs. Bank of America | Barclays PLC vs. Bank of America | Barclays PLC vs. Banco Bilbao Vizcaya |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |