Correlation Between Hispanotels Inversiones and Bankinter

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

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

Diversification Opportunities for Hispanotels Inversiones and Bankinter

-0.18

Correlation Coefficient

Hispanotels Inversiones  Bankinter

Good diversification

The 3 months correlation between Hispanotels and Bankinter is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Hispanotels Inversiones SOCIMI and Bankinter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bankinter and Hispanotels Inversiones 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 Hispanotels Inversiones 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 Hispanotels Inversiones i.e., Hispanotels Inversiones and Bankinter go up and down completely randomly.

Pair Corralation between Hispanotels Inversiones and Bankinter

Assuming the 90 days trading horizon Hispanotels Inversiones SOCIMI is expected to generate 1.14 times more return on investment than Bankinter. However, Hispanotels Inversiones is 1.14 times more volatile than Bankinter. It trades about 0.19 of its potential returns per unit of risk. Bankinter is currently generating about -0.01 per unit of risk. If you would invest  581.00  in Hispanotels Inversiones SOCIMI on September 14, 2024 and sell it today you would earn a total of  129.00  from holding Hispanotels Inversiones SOCIMI or generate 22.2% return on investment over 90 days.

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

Hispanotels Inversiones SOCIMI  vs.  Bankinter

Hispanotels Inversiones

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hispanotels Inversiones SOCIMI are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Hispanotels Inversiones exhibited solid returns over the last few months and may actually be approaching a breakup point.

Bankinter

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Hispanotels Inversiones and Bankinter

The main advantage of trading using opposite Hispanotels Inversiones and Bankinter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hispanotels Inversiones 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 Hispanotels Inversiones 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.

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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.