Correlation Between Banque Cantonale and IShares BRIC
Can any of the company-specific risk be diversified away by investing in both Banque Cantonale and IShares BRIC 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 Banque Cantonale and IShares BRIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banque Cantonale du and iShares BRIC 50, you can compare the effects of market volatilities on Banque Cantonale and IShares BRIC 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 Banque Cantonale with a short position of IShares BRIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banque Cantonale and IShares BRIC.
Diversification Opportunities for Banque Cantonale and IShares BRIC
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Banque and IShares is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Banque Cantonale du and iShares BRIC 50 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares BRIC 50 and Banque Cantonale 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 Banque Cantonale du are associated (or correlated) with IShares BRIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares BRIC 50 has no effect on the direction of Banque Cantonale i.e., Banque Cantonale and IShares BRIC go up and down completely randomly.
Pair Corralation between Banque Cantonale and IShares BRIC
Assuming the 90 days trading horizon Banque Cantonale is expected to generate 3.36 times less return on investment than IShares BRIC. But when comparing it to its historical volatility, Banque Cantonale du is 2.66 times less risky than IShares BRIC. It trades about 0.03 of its potential returns per unit of risk. iShares BRIC 50 is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,732 in iShares BRIC 50 on September 2, 2024 and sell it today you would earn a total of 261.00 from holding iShares BRIC 50 or generate 15.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Banque Cantonale du vs. iShares BRIC 50
Performance |
| Timeline |
| Banque Cantonale |
| iShares BRIC 50 |
Banque Cantonale and IShares BRIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banque Cantonale and IShares BRIC
The main advantage of trading using opposite Banque Cantonale and IShares BRIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banque Cantonale position performs unexpectedly, IShares BRIC 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 IShares BRIC will offset losses from the drop in IShares BRIC's long position.| Banque Cantonale vs. Zurich Insurance Group | Banque Cantonale vs. VP Bank AG | Banque Cantonale vs. Metall Zug AG | Banque Cantonale vs. Luzerner Kantonalbank AG |
| IShares BRIC vs. iShares Core SP | IShares BRIC vs. iShares Core MSCI | IShares BRIC vs. Lyxor UCITS Stoxx |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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