Correlation Between Territorial Bancorp and Bankinter
Can any of the company-specific risk be diversified away by investing in both Territorial Bancorp 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 Territorial Bancorp and Bankinter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Territorial Bancorp and Bankinter SA, you can compare the effects of market volatilities on Territorial Bancorp 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 Territorial Bancorp with a short position of Bankinter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Territorial Bancorp and Bankinter.
Diversification Opportunities for Territorial Bancorp and Bankinter
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Territorial and Bankinter is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Territorial Bancorp and Bankinter SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankinter SA and Territorial 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 Territorial Bancorp 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 SA has no effect on the direction of Territorial Bancorp i.e., Territorial Bancorp and Bankinter go up and down completely randomly.
Pair Corralation between Territorial Bancorp and Bankinter
Given the investment horizon of 90 days Territorial Bancorp is expected to under-perform the Bankinter. But the stock apears to be less risky and, when comparing its historical volatility, Territorial Bancorp is 1.15 times less risky than Bankinter. The stock trades about -0.03 of its potential returns per unit of risk. The Bankinter SA is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 641.00 in Bankinter SA on September 4, 2024 and sell it today you would earn a total of 156.00 from holding Bankinter SA or generate 24.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 67.07% |
| Values | Daily Returns |
Territorial Bancorp vs. Bankinter SA
Performance |
| Timeline |
| Territorial Bancorp |
| Bankinter SA |
Territorial Bancorp and Bankinter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Territorial Bancorp and Bankinter
The main advantage of trading using opposite Territorial Bancorp and Bankinter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Territorial Bancorp 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.| Territorial Bancorp vs. International Bancshares | Territorial Bancorp vs. Finward Bancorp | Territorial Bancorp vs. Aquagold International | Territorial Bancorp vs. Thrivent High Yield |
| Bankinter vs. First Hawaiian | Bankinter vs. Central Pacific Financial | Bankinter vs. Territorial Bancorp | Bankinter vs. Comerica |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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