Correlation Between BankInvest Value and BankInvest Select

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

By analyzing existing cross correlation between BankInvest Value Globale and BankInvest Select Small, you can compare the effects of market volatilities on BankInvest Value and BankInvest Select 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 Value with a short position of BankInvest Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of BankInvest Value and BankInvest Select.

Diversification Opportunities for BankInvest Value and BankInvest Select

0.0

Correlation Coefficient

BankInvest Value  BankInvest Select

Pay attention - limited upside

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

Pair Corralation between BankInvest Value and BankInvest Select

If you would invest  10,845  in BankInvest Value Globale on October 26, 2024 and sell it today you would lose (165.00) from holding BankInvest Value Globale or give up 1.52% of portfolio value over 90 days.

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

BankInvest Value Globale  vs.  BankInvest Select Small

BankInvest Value Globale

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BankInvest Value Globale are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, BankInvest Value is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

BankInvest Select Small

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days BankInvest Select Small has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound forward-looking signals, BankInvest Select is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with BankInvest Value and BankInvest Select

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

The idea behind BankInvest Value Globale and BankInvest Select Small 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.