Correlation Between Capital One and Monex SAB

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

By analyzing existing cross correlation between Capital One Financial and Monex SAB de, you can compare the effects of market volatilities on Capital One and Monex SAB 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 Capital One with a short position of Monex SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital One and Monex SAB.

Diversification Opportunities for Capital One and Monex SAB

0.0

Correlation Coefficient

Capital One  Monex SAB

Pay attention - limited upside

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

Pair Corralation between Capital One and Monex SAB

If you would invest  2,000  in Monex SAB de on September 27, 2024 and sell it today you would earn a total of  0.00  from holding Monex SAB de or generate 0.0% return on investment over 90 days.

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

Capital One Financial  vs.  Monex SAB de

Capital One Financial

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Capital One Financial are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, Capital One showed solid returns over the last few months and may actually be approaching a breakup point.

Monex SAB de

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Monex SAB de has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Monex SAB is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Capital One and Monex SAB

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

The idea behind Capital One Financial and Monex SAB de 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..