Correlation Between Intel and Barclays Capital

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

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

Diversification Opportunities for Intel and Barclays Capital

-0.35

Correlation Coefficient

Intel  Barclays Capital

Very good diversification

The 3 months correlation between Intel and Barclays is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Barclays Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays Capital and Intel 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 Intel are associated (or correlated) with Barclays Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays Capital has no effect on the direction of Intel i.e., Intel and Barclays Capital go up and down completely randomly.

Pair Corralation between Intel and Barclays Capital

Given the investment horizon of 90 days Intel is expected to generate 2.43 times more return on investment than Barclays Capital. However, Intel is 2.43 times more volatile than Barclays Capital. It trades about 0.0 of its potential returns per unit of risk. Barclays Capital is currently generating about -0.08 per unit of risk. If you would invest  2,501  in Intel on September 16, 2024 and sell it today you would lose (467.00) from holding Intel or give up 18.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	28.23%
Values	Daily Returns

Intel  vs.  Barclays Capital

Intel

Risk-Adjusted Performance

0 of 100

Very Weak

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

Barclays Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Barclays Capital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward-looking indicators, Barclays Capital is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Intel and Barclays Capital

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

The idea behind Intel and Barclays Capital 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.