Correlation Between CaixaBank and JAPAN POST
Can any of the company-specific risk be diversified away by investing in both CaixaBank and JAPAN POST 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 JAPAN POST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CaixaBank SA and JAPAN POST BANK, you can compare the effects of market volatilities on CaixaBank and JAPAN POST 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 JAPAN POST. Check out your portfolio center. Please also check ongoing floating volatility patterns of CaixaBank and JAPAN POST.
Diversification Opportunities for CaixaBank and JAPAN POST
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CaixaBank and JAPAN is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding CaixaBank SA and JAPAN POST BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPAN POST BANK 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 JAPAN POST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPAN POST BANK has no effect on the direction of CaixaBank i.e., CaixaBank and JAPAN POST go up and down completely randomly.
Pair Corralation between CaixaBank and JAPAN POST
Assuming the 90 days horizon CaixaBank SA is expected to generate 1.69 times more return on investment than JAPAN POST. However, CaixaBank is 1.69 times more volatile than JAPAN POST BANK. It trades about 0.02 of its potential returns per unit of risk. JAPAN POST BANK is currently generating about 0.01 per unit of risk. If you would invest 545.00 in CaixaBank SA on October 22, 2024 and sell it today you would earn a total of 10.00 from holding CaixaBank SA or generate 1.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
CaixaBank SA vs. JAPAN POST BANK
Performance |
| Timeline |
| CaixaBank SA |
| JAPAN POST BANK |
CaixaBank and JAPAN POST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CaixaBank and JAPAN POST
The main advantage of trading using opposite CaixaBank and JAPAN POST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CaixaBank position performs unexpectedly, JAPAN POST 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 JAPAN POST will offset losses from the drop in JAPAN POST's long position.| CaixaBank vs. Bankinter SA ADR | CaixaBank vs. First Horizon | CaixaBank vs. JAPAN POST BANK | CaixaBank vs. JAPAN POST BANK |
| JAPAN POST vs. Bankinter SA ADR | JAPAN POST vs. First Horizon | JAPAN POST vs. JAPAN POST BANK | JAPAN POST vs. CaixaBank 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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