Correlation Between 90331HPL1 and INTEL

Can any of the company-specific risk be diversified away by investing in both 90331HPL1 and INTEL 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 90331HPL1 and INTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between US BANK NATIONAL and INTEL PORATION, you can compare the effects of market volatilities on 90331HPL1 and INTEL 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 90331HPL1 with a short position of INTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of 90331HPL1 and INTEL.

Diversification Opportunities for 90331HPL1 and INTEL

0.37

Correlation Coefficient

90331HPL1  INTEL

Weak diversification

The 3 months correlation between 90331HPL1 and INTEL is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding US BANK NATIONAL and INTEL PORATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTEL PORATION and 90331HPL1 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 US BANK NATIONAL are associated (or correlated) with INTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTEL PORATION has no effect on the direction of 90331HPL1 i.e., 90331HPL1 and INTEL go up and down completely randomly.

Pair Corralation between 90331HPL1 and INTEL

Assuming the 90 days trading horizon US BANK NATIONAL is expected to under-perform the INTEL. But the bond apears to be less risky and, when comparing its historical volatility, US BANK NATIONAL is 2.54 times less risky than INTEL. The bond trades about -0.12 of its potential returns per unit of risk. The INTEL PORATION is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  8,425  in INTEL PORATION on October 8, 2024 and sell it today you would earn a total of  529.00  from holding INTEL PORATION or generate 6.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	58.33%
Values	Daily Returns

US BANK NATIONAL  vs.  INTEL PORATION

US BANK NATIONAL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days US BANK NATIONAL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for US BANK NATIONAL investors.

INTEL PORATION

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in INTEL PORATION are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, INTEL may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with 90331HPL1 and INTEL

The main advantage of trading using opposite 90331HPL1 and INTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 90331HPL1 position performs unexpectedly, INTEL 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 INTEL will offset losses from the drop in INTEL's long position.

The idea behind US BANK NATIONAL and INTEL PORATION 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.