Correlation Between Urbas Grupo and Caixabank
Can any of the company-specific risk be diversified away by investing in both Urbas Grupo and Caixabank 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 Urbas Grupo and Caixabank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Urbas Grupo Financiero and Caixabank SA, you can compare the effects of market volatilities on Urbas Grupo and Caixabank 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 Urbas Grupo with a short position of Caixabank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Urbas Grupo and Caixabank.
Diversification Opportunities for Urbas Grupo and Caixabank
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Urbas and Caixabank is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Urbas Grupo Financiero and Caixabank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caixabank SA and Urbas Grupo 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 Urbas Grupo Financiero are associated (or correlated) with Caixabank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caixabank SA has no effect on the direction of Urbas Grupo i.e., Urbas Grupo and Caixabank go up and down completely randomly.
Pair Corralation between Urbas Grupo and Caixabank
Assuming the 90 days trading horizon Urbas Grupo Financiero is expected to under-perform the Caixabank. In addition to that, Urbas Grupo is 1.76 times more volatile than Caixabank SA. It trades about -0.06 of its total potential returns per unit of risk. Caixabank SA is currently generating about 0.1 per unit of volatility. If you would invest 361.00 in Caixabank SA on September 2, 2024 and sell it today you would earn a total of 154.00 from holding Caixabank SA or generate 42.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Urbas Grupo Financiero vs. Caixabank SA
Performance |
| Timeline |
| Urbas Grupo Financiero |
| Caixabank SA |
Urbas Grupo and Caixabank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Urbas Grupo and Caixabank
The main advantage of trading using opposite Urbas Grupo and Caixabank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Urbas Grupo position performs unexpectedly, Caixabank 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 Caixabank will offset losses from the drop in Caixabank's long position.| Urbas Grupo vs. Caixabank SA | Urbas Grupo vs. International Consolidated Airlines | Urbas Grupo vs. All Iron Re | Urbas Grupo vs. Plasticos Compuestos SA |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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