Correlation Between Equity Bancshares, and Banco Macro
Can any of the company-specific risk be diversified away by investing in both Equity Bancshares, 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 Equity Bancshares, and Banco Macro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equity Bancshares, and Banco Macro SA, you can compare the effects of market volatilities on Equity Bancshares, 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 Equity Bancshares, with a short position of Banco Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equity Bancshares, and Banco Macro.
Diversification Opportunities for Equity Bancshares, and Banco Macro
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Equity and Banco is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Equity Bancshares, 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 Equity Bancshares, 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 Equity Bancshares, 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 Equity Bancshares, i.e., Equity Bancshares, and Banco Macro go up and down completely randomly.
Pair Corralation between Equity Bancshares, and Banco Macro
Given the investment horizon of 90 days Equity Bancshares, is expected to generate 0.95 times more return on investment than Banco Macro. However, Equity Bancshares, is 1.06 times less risky than Banco Macro. It trades about 0.23 of its potential returns per unit of risk. Banco Macro SA is currently generating about 0.05 per unit of risk. If you would invest 4,364 in Equity Bancshares, on August 27, 2024 and sell it today you would earn a total of 557.00 from holding Equity Bancshares, or generate 12.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equity Bancshares, vs. Banco Macro SA
Performance |
| Timeline |
| Equity Bancshares, |
| Banco Macro SA |
Equity Bancshares, and Banco Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equity Bancshares, and Banco Macro
The main advantage of trading using opposite Equity Bancshares, and Banco Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equity Bancshares, 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.| Equity Bancshares, vs. Brookline Bancorp | Equity Bancshares, vs. Kearny Financial Corp | Equity Bancshares, vs. Heritage Financial | Equity Bancshares, vs. FVCBankcorp |
| 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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