Correlation Between CIFI Holdings and BANKINTER ADR
Can any of the company-specific risk be diversified away by investing in both CIFI Holdings 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 CIFI Holdings and BANKINTER ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIFI Holdings Co and BANKINTER ADR 2007, you can compare the effects of market volatilities on CIFI Holdings 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 CIFI Holdings with a short position of BANKINTER ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIFI Holdings and BANKINTER ADR.
Diversification Opportunities for CIFI Holdings and BANKINTER ADR
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CIFI and BANKINTER is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding CIFI Holdings Co 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 CIFI Holdings 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 CIFI Holdings Co 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 CIFI Holdings i.e., CIFI Holdings and BANKINTER ADR go up and down completely randomly.
Pair Corralation between CIFI Holdings and BANKINTER ADR
Assuming the 90 days horizon CIFI Holdings Co is expected to generate 4.86 times more return on investment than BANKINTER ADR. However, CIFI Holdings is 4.86 times more volatile than BANKINTER ADR 2007. It trades about 0.03 of its potential returns per unit of risk. BANKINTER ADR 2007 is currently generating about 0.03 per unit of risk. If you would invest 3.35 in CIFI Holdings Co on September 24, 2024 and sell it today you would lose (0.50) from holding CIFI Holdings Co or give up 14.93% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
CIFI Holdings Co vs. BANKINTER ADR 2007
Performance |
Timeline |
CIFI Holdings |
BANKINTER ADR 2007 |
CIFI Holdings and BANKINTER ADR Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CIFI Holdings and BANKINTER ADR
The main advantage of trading using opposite CIFI Holdings and BANKINTER ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIFI Holdings 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.CIFI Holdings vs. BANKINTER ADR 2007 | CIFI Holdings vs. Martin Marietta Materials | CIFI Holdings vs. CDN IMPERIAL BANK | CIFI Holdings vs. Vulcan Materials |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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