Correlation Between Itau Unibanco and Bank of Hawaii
Can any of the company-specific risk be diversified away by investing in both Itau Unibanco and Bank of Hawaii 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 Itau Unibanco and Bank of Hawaii into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Itau Unibanco Banco and Bank of Hawaii, you can compare the effects of market volatilities on Itau Unibanco and Bank of Hawaii 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 Itau Unibanco with a short position of Bank of Hawaii. Check out your portfolio center. Please also check ongoing floating volatility patterns of Itau Unibanco and Bank of Hawaii.
Diversification Opportunities for Itau Unibanco and Bank of Hawaii
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Itau and Bank is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Itau Unibanco Banco and Bank of Hawaii in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Hawaii and Itau Unibanco 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 Itau Unibanco Banco are associated (or correlated) with Bank of Hawaii. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Hawaii has no effect on the direction of Itau Unibanco i.e., Itau Unibanco and Bank of Hawaii go up and down completely randomly.
Pair Corralation between Itau Unibanco and Bank of Hawaii
Given the investment horizon of 90 days Itau Unibanco Banco is expected to under-perform the Bank of Hawaii. In addition to that, Itau Unibanco is 1.96 times more volatile than Bank of Hawaii. It trades about -0.07 of its total potential returns per unit of risk. Bank of Hawaii is currently generating about 0.0 per unit of volatility. If you would invest 1,628 in Bank of Hawaii on November 30, 2024 and sell it today you would earn a total of 0.00 from holding Bank of Hawaii or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Itau Unibanco Banco vs. Bank of Hawaii
Performance |
Timeline |
Itau Unibanco Banco |
Bank of Hawaii |
Itau Unibanco and Bank of Hawaii Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Itau Unibanco and Bank of Hawaii
The main advantage of trading using opposite Itau Unibanco and Bank of Hawaii positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Itau Unibanco position performs unexpectedly, Bank of Hawaii 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 Bank of Hawaii will offset losses from the drop in Bank of Hawaii's long position.Itau Unibanco vs. Grupo Financiero Galicia | Itau Unibanco vs. Banco Macro SA | Itau Unibanco vs. Banco Santander Brasil | Itau Unibanco vs. Lloyds Banking Group |
Bank of Hawaii vs. CullenFrost Bankers | Bank of Hawaii vs. Citizens Financial Group | Bank of Hawaii vs. Cadence Bank | Bank of Hawaii vs. Truist Financial |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |