Correlation Between Caixabank and Asturiana
Can any of the company-specific risk be diversified away by investing in both Caixabank and Asturiana 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 Caixabank and Asturiana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caixabank SA and Asturiana de Laminados, you can compare the effects of market volatilities on Caixabank and Asturiana 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 Caixabank with a short position of Asturiana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caixabank and Asturiana.
Diversification Opportunities for Caixabank and Asturiana
Good diversification
The 3 months correlation between Caixabank and Asturiana is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Caixabank SA and Asturiana de Laminados in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asturiana de Laminados and Caixabank 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 Caixabank SA are associated (or correlated) with Asturiana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asturiana de Laminados has no effect on the direction of Caixabank i.e., Caixabank and Asturiana go up and down completely randomly.
Pair Corralation between Caixabank and Asturiana
Assuming the 90 days trading horizon Caixabank SA is expected to generate 0.33 times more return on investment than Asturiana. However, Caixabank SA is 3.01 times less risky than Asturiana. It trades about 0.1 of its potential returns per unit of risk. Asturiana de Laminados is currently generating about -0.02 per unit of risk. If you would invest 358.00 in Caixabank SA on September 4, 2024 and sell it today you would earn a total of 158.00 from holding Caixabank SA or generate 44.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Caixabank SA vs. Asturiana de Laminados
Performance |
| Timeline |
| Caixabank SA |
| Asturiana de Laminados |
Caixabank and Asturiana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caixabank and Asturiana
The main advantage of trading using opposite Caixabank and Asturiana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caixabank position performs unexpectedly, Asturiana 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 Asturiana will offset losses from the drop in Asturiana's long position.The idea behind Caixabank SA and Asturiana de Laminados 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.| Asturiana vs. Inhome Prime Properties | Asturiana vs. Neinor Homes SLU | Asturiana vs. Home Capital Rentals | Asturiana vs. Tier1 Technology SA |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |