Correlation Between Eagle Bancorp and Banco Macro
Can any of the company-specific risk be diversified away by investing in both Eagle Bancorp and Banco Macro 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 Eagle Bancorp and Banco Macro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Bancorp Montana and Banco Macro SA, you can compare the effects of market volatilities on Eagle Bancorp and Banco Macro 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 Eagle Bancorp with a short position of Banco Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Bancorp and Banco Macro.
Diversification Opportunities for Eagle Bancorp and Banco Macro
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eagle and Banco is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Bancorp Montana and Banco Macro SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Macro SA and Eagle Bancorp 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 Eagle Bancorp Montana are associated (or correlated) with Banco Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Macro SA has no effect on the direction of Eagle Bancorp i.e., Eagle Bancorp and Banco Macro go up and down completely randomly.
Pair Corralation between Eagle Bancorp and Banco Macro
Given the investment horizon of 90 days Eagle Bancorp Montana is expected to under-perform the Banco Macro. But the stock apears to be less risky and, when comparing its historical volatility, Eagle Bancorp Montana is 2.73 times less risky than Banco Macro. The stock trades about -0.11 of its potential returns per unit of risk. The Banco Macro SA is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 7,911 in Banco Macro SA on October 26, 2024 and sell it today you would earn a total of 2,965 from holding Banco Macro SA or generate 37.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Bancorp Montana vs. Banco Macro SA
Performance |
| Timeline |
| Eagle Bancorp Montana |
| Banco Macro SA |
Eagle Bancorp and Banco Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Bancorp and Banco Macro
The main advantage of trading using opposite Eagle Bancorp and Banco Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Bancorp position performs unexpectedly, Banco Macro 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 Banco Macro will offset losses from the drop in Banco Macro's long position.| Eagle Bancorp vs. Home Federal Bancorp | Eagle Bancorp vs. First Financial Northwest | Eagle Bancorp vs. First Northwest Bancorp | Eagle Bancorp vs. First Capital |
| Banco Macro vs. Grupo Supervielle SA | Banco Macro vs. BBVA Banco Frances | Banco Macro vs. Banco Bradesco SA | Banco Macro vs. Itau Unibanco Banco |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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