Correlation Between Finward Bancorp and Itau Unibanco
Can any of the company-specific risk be diversified away by investing in both Finward Bancorp and Itau Unibanco 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 Finward Bancorp and Itau Unibanco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finward Bancorp and Itau Unibanco Banco, you can compare the effects of market volatilities on Finward Bancorp and Itau Unibanco 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 Finward Bancorp with a short position of Itau Unibanco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finward Bancorp and Itau Unibanco.
Diversification Opportunities for Finward Bancorp and Itau Unibanco
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Finward and Itau is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Finward Bancorp and Itau Unibanco Banco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Itau Unibanco Banco and Finward 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 Finward Bancorp are associated (or correlated) with Itau Unibanco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Itau Unibanco Banco has no effect on the direction of Finward Bancorp i.e., Finward Bancorp and Itau Unibanco go up and down completely randomly.
Pair Corralation between Finward Bancorp and Itau Unibanco
Given the investment horizon of 90 days Finward Bancorp is expected to generate 0.98 times more return on investment than Itau Unibanco. However, Finward Bancorp is 1.02 times less risky than Itau Unibanco. It trades about 0.13 of its potential returns per unit of risk. Itau Unibanco Banco is currently generating about -0.01 per unit of risk. If you would invest 2,439 in Finward Bancorp on August 30, 2024 and sell it today you would earn a total of 652.00 from holding Finward Bancorp or generate 26.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Finward Bancorp vs. Itau Unibanco Banco
Performance |
| Timeline |
| Finward Bancorp |
| Itau Unibanco Banco |
Finward Bancorp and Itau Unibanco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finward Bancorp and Itau Unibanco
The main advantage of trading using opposite Finward Bancorp and Itau Unibanco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finward Bancorp position performs unexpectedly, Itau Unibanco 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 Itau Unibanco will offset losses from the drop in Itau Unibanco's long position.| Finward Bancorp vs. Community West Bancshares | Finward Bancorp vs. First Financial Northwest | Finward Bancorp vs. Oak Valley Bancorp | Finward Bancorp vs. Home Federal Bancorp |
| Itau Unibanco vs. Grupo Financiero Galicia | Itau Unibanco vs. Banco Macro SA | Itau Unibanco vs. Banco Santander Brasil | Itau Unibanco vs. Lloyds Banking Group |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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