Correlation Between Parlem Telecom and Bankinter
Can any of the company-specific risk be diversified away by investing in both Parlem Telecom and Bankinter 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 Parlem Telecom and Bankinter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Parlem Telecom Companyia and Bankinter, you can compare the effects of market volatilities on Parlem Telecom and Bankinter 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 Parlem Telecom with a short position of Bankinter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Parlem Telecom and Bankinter.
Diversification Opportunities for Parlem Telecom and Bankinter
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Parlem and Bankinter is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Parlem Telecom Companyia and Bankinter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankinter and Parlem Telecom 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 Parlem Telecom Companyia are associated (or correlated) with Bankinter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bankinter has no effect on the direction of Parlem Telecom i.e., Parlem Telecom and Bankinter go up and down completely randomly.
Pair Corralation between Parlem Telecom and Bankinter
Assuming the 90 days trading horizon Parlem Telecom Companyia is expected to generate 1.28 times more return on investment than Bankinter. However, Parlem Telecom is 1.28 times more volatile than Bankinter. It trades about 0.0 of its potential returns per unit of risk. Bankinter is currently generating about -0.02 per unit of risk. If you would invest 346.00 in Parlem Telecom Companyia on August 28, 2024 and sell it today you would lose (10.00) from holding Parlem Telecom Companyia or give up 2.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Parlem Telecom Companyia vs. Bankinter
Performance |
| Timeline |
| Parlem Telecom ia |
| Bankinter |
Parlem Telecom and Bankinter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Parlem Telecom and Bankinter
The main advantage of trading using opposite Parlem Telecom and Bankinter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Parlem Telecom position performs unexpectedly, Bankinter 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 Bankinter will offset losses from the drop in Bankinter's long position.| Parlem Telecom vs. Tier1 Technology SA | Parlem Telecom vs. Vytrus Biotech SA | Parlem Telecom vs. Home Capital Rentals | Parlem Telecom vs. Neinor Homes SLU |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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