Correlation Between Bankinter and Energy Solar

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

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

Diversification Opportunities for Bankinter and Energy Solar

0.59

Correlation Coefficient

Bankinter  Energy Solar

Very weak diversification

The 3 months correlation between Bankinter and Energy is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bankinter and Energy Solar Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Solar Tech and Bankinter 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 Bankinter are associated (or correlated) with Energy Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Solar Tech has no effect on the direction of Bankinter i.e., Bankinter and Energy Solar go up and down completely randomly.

Pair Corralation between Bankinter and Energy Solar

Assuming the 90 days trading horizon Bankinter is expected to generate 2.09 times less return on investment than Energy Solar. But when comparing it to its historical volatility, Bankinter is 3.52 times less risky than Energy Solar. It trades about 0.18 of its potential returns per unit of risk. Energy Solar Tech is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  214.00  in Energy Solar Tech on April 25, 2025 and sell it today you would earn a total of  58.00  from holding Energy Solar Tech or generate 27.1% return on investment over 90 days.

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

Bankinter  vs.  Energy Solar Tech

Bankinter

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bankinter are ranked lower than 14 (%) 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.

Energy Solar Tech

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Energy Solar Tech are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Energy Solar exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bankinter and Energy Solar

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

The idea behind Bankinter and Energy Solar Tech 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.