Correlation Between Adriano Care and Bankinter

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

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

Diversification Opportunities for Adriano Care and Bankinter

0.7

Correlation Coefficient

Adriano Care  Bankinter

Poor diversification

The 3 months correlation between Adriano and Bankinter is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Adriano Care SOCIMI and Bankinter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankinter and Adriano Care 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 Adriano Care SOCIMI are associated (or correlated) with Bankinter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bankinter has no effect on the direction of Adriano Care i.e., Adriano Care and Bankinter go up and down completely randomly.

Pair Corralation between Adriano Care and Bankinter

Assuming the 90 days trading horizon Adriano Care is expected to generate 34.33 times less return on investment than Bankinter. But when comparing it to its historical volatility, Adriano Care SOCIMI is 12.29 times less risky than Bankinter. It trades about 0.13 of its potential returns per unit of risk. Bankinter is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest  748.00  in Bankinter on December 24, 2024 and sell it today you would earn a total of  295.00  from holding Bankinter or generate 39.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Adriano Care SOCIMI  vs.  Bankinter

Adriano Care SOCIMI

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Adriano Care SOCIMI are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Adriano Care is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Bankinter

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Bankinter are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Bankinter exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Adriano Care and Bankinter

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

The idea behind Adriano Care SOCIMI and Bankinter 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.