Correlation Between SVB Financial and Ita Unibanco

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

By analyzing existing cross correlation between SVB Financial Group and Ita Unibanco Holding, you can compare the effects of market volatilities on SVB Financial and Ita Unibanco 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 SVB Financial with a short position of Ita Unibanco. Check out your portfolio center. Please also check ongoing floating volatility patterns of SVB Financial and Ita Unibanco.

Diversification Opportunities for SVB Financial and Ita Unibanco

0.0

Correlation Coefficient

SVB Financial  Ita Unibanco

Pay attention - limited upside

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

Pair Corralation between SVB Financial and Ita Unibanco

If you would invest  12,007  in SVB Financial Group on September 5, 2024 and sell it today you would earn a total of  0.00  from holding SVB Financial Group 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

SVB Financial Group  vs.  Ita Unibanco Holding

SVB Financial Group

Risk-Adjusted Performance

0 of 100

Very Weak

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

Ita Unibanco Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ita Unibanco Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with SVB Financial and Ita Unibanco

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

The idea behind SVB Financial Group and Ita Unibanco Holding 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.