Correlation Between Caixabank and Indexa Capital
Can any of the company-specific risk be diversified away by investing in both Caixabank and Indexa Capital 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 Indexa Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caixabank SA and Indexa Capital Group,, you can compare the effects of market volatilities on Caixabank and Indexa Capital 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 Indexa Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caixabank and Indexa Capital.
Diversification Opportunities for Caixabank and Indexa Capital
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Caixabank and Indexa is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Caixabank SA and Indexa Capital Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indexa Capital Group, 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 Indexa Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indexa Capital Group, has no effect on the direction of Caixabank i.e., Caixabank and Indexa Capital go up and down completely randomly.
Pair Corralation between Caixabank and Indexa Capital
Assuming the 90 days trading horizon Caixabank SA is expected to generate 5.22 times more return on investment than Indexa Capital. However, Caixabank is 5.22 times more volatile than Indexa Capital Group,. It trades about -0.04 of its potential returns per unit of risk. Indexa Capital Group, is currently generating about -0.41 per unit of risk. If you would invest 525.00 in Caixabank SA on August 29, 2024 and sell it today you would lose (20.00) from holding Caixabank SA or give up 3.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caixabank SA vs. Indexa Capital Group,
Performance |
| Timeline |
| Caixabank SA |
| Indexa Capital Group, |
Caixabank and Indexa Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caixabank and Indexa Capital
The main advantage of trading using opposite Caixabank and Indexa Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caixabank position performs unexpectedly, Indexa Capital 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 Indexa Capital will offset losses from the drop in Indexa Capital's long position.| Caixabank vs. Bankinter | Caixabank vs. Metrovacesa SA | Caixabank vs. Atom Hoteles Socimi | Caixabank vs. Aedas Homes SL |
| Indexa Capital vs. Petroleo Brasileiro SA | Indexa Capital vs. Banco Santander | Indexa Capital vs. Caixabank SA | Indexa Capital vs. Cellnex Telecom 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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