Correlation Between Banco De and Quinenco
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By analyzing existing cross correlation between Banco de Chile and Quinenco, you can compare the effects of market volatilities on Banco De and Quinenco 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 Quinenco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco De and Quinenco.
Diversification Opportunities for Banco De and Quinenco
Almost no diversification
The 3 months correlation between Banco and Quinenco is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Banco de Chile and Quinenco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quinenco 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 Chile are associated (or correlated) with Quinenco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quinenco has no effect on the direction of Banco De i.e., Banco De and Quinenco go up and down completely randomly.
Pair Corralation between Banco De and Quinenco
Assuming the 90 days trading horizon Banco de Chile is expected to generate 0.72 times more return on investment than Quinenco. However, Banco de Chile is 1.4 times less risky than Quinenco. It trades about 0.1 of its potential returns per unit of risk. Quinenco is currently generating about 0.06 per unit of risk. If you would invest 7,301 in Banco de Chile on November 28, 2024 and sell it today you would earn a total of 5,310 from holding Banco de Chile or generate 72.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco de Chile vs. Quinenco
Performance |
| Timeline |
| Banco de Chile |
| Quinenco |
Banco De and Quinenco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco De and Quinenco
The main advantage of trading using opposite Banco De and Quinenco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco De position performs unexpectedly, Quinenco 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 Quinenco will offset losses from the drop in Quinenco's long position.| Banco De vs. Banco Santander Chile | Banco De vs. Banco de Credito | Banco De vs. Falabella | Banco De vs. Cencosud |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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