Correlation Between Bankinvest USA and Sparinv SICAV

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

By analyzing existing cross correlation between Bankinvest USA and Sparinv SICAV, you can compare the effects of market volatilities on Bankinvest USA and Sparinv SICAV 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 Bankinvest USA with a short position of Sparinv SICAV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankinvest USA and Sparinv SICAV.

Diversification Opportunities for Bankinvest USA and Sparinv SICAV

0.0

Correlation Coefficient

Bankinvest USA  Sparinv SICAV

Pay attention - limited upside

The 3 months correlation between Bankinvest and Sparinv is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bankinvest USA and Sparinv SICAV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparinv SICAV and Bankinvest USA 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 Bankinvest USA are associated (or correlated) with Sparinv SICAV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparinv SICAV has no effect on the direction of Bankinvest USA i.e., Bankinvest USA and Sparinv SICAV go up and down completely randomly.

Pair Corralation between Bankinvest USA and Sparinv SICAV

If you would invest  26,750  in Sparinv SICAV on September 11, 2024 and sell it today you would earn a total of  2,920  from holding Sparinv SICAV or generate 10.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Bankinvest USA  vs.  Sparinv SICAV

Bankinvest USA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bankinvest USA has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Bankinvest USA is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Sparinv SICAV

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sparinv SICAV are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather weak technical and fundamental indicators, Sparinv SICAV may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Bankinvest USA and Sparinv SICAV

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

The idea behind Bankinvest USA and Sparinv SICAV 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.

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.