Correlation Between Materialise and BANKINTER ADR

Can any of the company-specific risk be diversified away by investing in both Materialise and BANKINTER ADR 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 Materialise and BANKINTER ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Materialise NV and BANKINTER ADR 2007, you can compare the effects of market volatilities on Materialise and BANKINTER ADR 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 Materialise with a short position of BANKINTER ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Materialise and BANKINTER ADR.

Diversification Opportunities for Materialise and BANKINTER ADR

-0.69

Correlation Coefficient

Materialise  BANKINTER ADR

Excellent diversification

The 3 months correlation between Materialise and BANKINTER is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Materialise NV and BANKINTER ADR 2007 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANKINTER ADR 2007 and Materialise 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 Materialise NV are associated (or correlated) with BANKINTER ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANKINTER ADR 2007 has no effect on the direction of Materialise i.e., Materialise and BANKINTER ADR go up and down completely randomly.

Pair Corralation between Materialise and BANKINTER ADR

Assuming the 90 days trading horizon Materialise NV is expected to under-perform the BANKINTER ADR. In addition to that, Materialise is 3.19 times more volatile than BANKINTER ADR 2007. It trades about -0.08 of its total potential returns per unit of risk. BANKINTER ADR 2007 is currently generating about 0.35 per unit of volatility. If you would invest  715.00  in BANKINTER ADR 2007 on December 24, 2024 and sell it today you would earn a total of  305.00  from holding BANKINTER ADR 2007 or generate 42.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Materialise NV  vs.  BANKINTER ADR 2007

Materialise NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Materialise NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

BANKINTER ADR 2007

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in BANKINTER ADR 2007 are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, BANKINTER ADR reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Materialise and BANKINTER ADR

The main advantage of trading using opposite Materialise and BANKINTER ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Materialise position performs unexpectedly, BANKINTER ADR 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 ADR will offset losses from the drop in BANKINTER ADR's long position.

The idea behind Materialise NV and BANKINTER ADR 2007 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.