Correlation Between Banque Nationale and Whitestone

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

By analyzing existing cross correlation between Banque nationale de and Whitestone Group, you can compare the effects of market volatilities on Banque Nationale and Whitestone 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 Banque Nationale with a short position of Whitestone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banque Nationale and Whitestone.

Diversification Opportunities for Banque Nationale and Whitestone

-0.33

Correlation Coefficient

Banque Nationale  Whitestone

Very good diversification

The 3 months correlation between Banque and Whitestone is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Banque nationale de and Whitestone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Whitestone Group and Banque Nationale 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 Banque nationale de are associated (or correlated) with Whitestone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Whitestone Group has no effect on the direction of Banque Nationale i.e., Banque Nationale and Whitestone go up and down completely randomly.

Pair Corralation between Banque Nationale and Whitestone

Assuming the 90 days trading horizon Banque nationale de is expected to under-perform the Whitestone. But the stock apears to be less risky and, when comparing its historical volatility, Banque nationale de is 1.13 times less risky than Whitestone. The stock trades about -0.13 of its potential returns per unit of risk. The Whitestone Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,220  in Whitestone Group on September 21, 2024 and sell it today you would earn a total of  50.00  from holding Whitestone Group or generate 4.1% return on investment over 90 days.

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

Banque nationale de  vs.  Whitestone Group

Banque nationale

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Banque nationale de has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's fundamental drivers remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Whitestone Group

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Whitestone Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Whitestone is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Banque Nationale and Whitestone

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

The idea behind Banque nationale de and Whitestone Group 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.