Correlation Between ALERION CLEANPOWER and BANKINTER ADR

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Can any of the company-specific risk be diversified away by investing in both ALERION CLEANPOWER 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 ALERION CLEANPOWER and BANKINTER ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALERION CLEANPOWER and BANKINTER ADR 2007, you can compare the effects of market volatilities on ALERION CLEANPOWER 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 ALERION CLEANPOWER with a short position of BANKINTER ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALERION CLEANPOWER and BANKINTER ADR.

Diversification Opportunities for ALERION CLEANPOWER and BANKINTER ADR

ALERIONBANKINTERDiversified AwayALERIONBANKINTERDiversified Away100%
-0.61
  Correlation Coefficient

Excellent diversification

The 3 months correlation between ALERION and BANKINTER is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding ALERION CLEANPOWER 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 ALERION CLEANPOWER 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 ALERION CLEANPOWER 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 ALERION CLEANPOWER i.e., ALERION CLEANPOWER and BANKINTER ADR go up and down completely randomly.

Pair Corralation between ALERION CLEANPOWER and BANKINTER ADR

Assuming the 90 days trading horizon ALERION CLEANPOWER is expected to under-perform the BANKINTER ADR. But the stock apears to be less risky and, when comparing its historical volatility, ALERION CLEANPOWER is 1.56 times less risky than BANKINTER ADR. The stock trades about -0.12 of its potential returns per unit of risk. The BANKINTER ADR 2007 is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  790.00  in BANKINTER ADR 2007 on November 21, 2024 and sell it today you would earn a total of  75.00  from holding BANKINTER ADR 2007 or generate 9.49% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

ALERION CLEANPOWER  vs.  BANKINTER ADR 2007

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 0510152025
JavaScript chart by amCharts 3.21.15FCW3 BAK
       Timeline  
ALERION CLEANPOWER 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days ALERION CLEANPOWER has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb14.51515.51616.51717.51818.5
BANKINTER ADR 2007 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in BANKINTER ADR 2007 are ranked lower than 16 (%) 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.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb77.588.5

ALERION CLEANPOWER and BANKINTER ADR Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.79-5.84-3.88-1.920.0331.953.935.917.89 0.020.040.060.080.100.12
JavaScript chart by amCharts 3.21.15FCW3 BAK
       Returns  

Pair Trading with ALERION CLEANPOWER and BANKINTER ADR

The main advantage of trading using opposite ALERION CLEANPOWER and BANKINTER ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALERION CLEANPOWER 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.
The idea behind ALERION CLEANPOWER and BANKINTER ADR 2007 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.

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