Correlation Between Edesa Holding and BBVA Banco
Can any of the company-specific risk be diversified away by investing in both Edesa Holding and BBVA Banco 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 Edesa Holding and BBVA Banco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edesa Holding SA and BBVA Banco Frances, you can compare the effects of market volatilities on Edesa Holding and BBVA Banco 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 Edesa Holding with a short position of BBVA Banco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edesa Holding and BBVA Banco.
Diversification Opportunities for Edesa Holding and BBVA Banco
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Edesa and BBVA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Edesa Holding SA and BBVA Banco Frances in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BBVA Banco Frances and Edesa Holding 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 Edesa Holding SA are associated (or correlated) with BBVA Banco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BBVA Banco Frances has no effect on the direction of Edesa Holding i.e., Edesa Holding and BBVA Banco go up and down completely randomly.
Pair Corralation between Edesa Holding and BBVA Banco
If you would invest 386,250 in BBVA Banco Frances on September 2, 2024 and sell it today you would earn a total of 230,750 from holding BBVA Banco Frances or generate 59.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Edesa Holding SA vs. BBVA Banco Frances
Performance |
| Timeline |
| Edesa Holding SA |
| BBVA Banco Frances |
Edesa Holding and BBVA Banco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edesa Holding and BBVA Banco
The main advantage of trading using opposite Edesa Holding and BBVA Banco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edesa Holding position performs unexpectedly, BBVA Banco 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 BBVA Banco will offset losses from the drop in BBVA Banco's long position.| Edesa Holding vs. Compania de Transporte | Edesa Holding vs. Agrometal SAI | Edesa Holding vs. Harmony Gold Mining | Edesa Holding vs. Telecom Argentina |
| BBVA Banco vs. Telecom Argentina | BBVA Banco vs. Harmony Gold Mining | BBVA Banco vs. United States Steel | BBVA Banco vs. Compania de Transporte |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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