Correlation Between BANKINTER ADR and IQVIA Holdings

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

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

Diversification Opportunities for BANKINTER ADR and IQVIA Holdings

-0.27

Correlation Coefficient

BANKINTER ADR  IQVIA Holdings

Very good diversification

The 3 months correlation between BANKINTER and IQVIA is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding BANKINTER ADR 2007 and IQVIA Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQVIA Holdings and BANKINTER ADR 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 BANKINTER ADR 2007 are associated (or correlated) with IQVIA Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQVIA Holdings has no effect on the direction of BANKINTER ADR i.e., BANKINTER ADR and IQVIA Holdings go up and down completely randomly.

Pair Corralation between BANKINTER ADR and IQVIA Holdings

Assuming the 90 days horizon BANKINTER ADR 2007 is expected to generate 1.08 times more return on investment than IQVIA Holdings. However, BANKINTER ADR is 1.08 times more volatile than IQVIA Holdings. It trades about 0.29 of its potential returns per unit of risk. IQVIA Holdings is currently generating about -0.06 per unit of risk. If you would invest  725.00  in BANKINTER ADR 2007 on December 3, 2024 and sell it today you would earn a total of  165.00  from holding BANKINTER ADR 2007 or generate 22.76% return on investment over 90 days.

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

BANKINTER ADR 2007  vs.  IQVIA Holdings

BANKINTER ADR 2007

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in BANKINTER ADR 2007 are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, BANKINTER ADR reported solid returns over the last few months and may actually be approaching a breakup point.

IQVIA Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days IQVIA Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, IQVIA Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with BANKINTER ADR and IQVIA Holdings

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

The idea behind BANKINTER ADR 2007 and IQVIA Holdings 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.