Banco Stock Volatility

BCH
 Stock
  

USD 17.45  0.78  4.28%   

Banco DE Chile secures Sharpe Ratio (or Efficiency) of -0.17, which signifies that the company had -0.17% of return per unit of risk over the last 3 months. Macroaxis standpoint towards foreseeing the risk of any stock is to look at both systematic and unsystematic factors of the business, including all available market data and technical indicators. Banco DE Chile exposes twenty-eight different technical indicators, which can help you to evaluate volatility that cannot be diversified away. Please be advised to confirm Banco DE Chile risk adjusted performance of (0.15), and Mean Deviation of 1.5 to double-check the risk estimate we provide.
  
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Banco DE Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Banco daily returns, and it is calculated using variance and standard deviation. We also use Banco's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Banco DE volatility.

360 Days Market Risk

Very steady

Chance of Distress

Very Low

360 Days Economic Sensitivity

Slowly supersedes the market
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Banco DE can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Banco DE at lower prices. For example, an investor can purchase Banco stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Banco DE's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Banco DE

0.7ABTXAllegiance Banc CSPairCorr
0.76ACNBAcnb CorpPairCorr
0.65AFBIAffinity BancsharesPairCorr
0.67ALRSAlerus Financial CorpPairCorr

Moving against Banco DE

0.81ACBIAtlantic Capital BanPairCorr

Banco DE Market Sensitivity And Downside Risk

Banco DE's beta coefficient measures the volatility of Banco stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Banco stock's returns against your selected market. In other words, Banco DE's beta of 0.49 provides an investor with an approximation of how much risk Banco DE stock can potentially add to one of your existing portfolios.
Let's try to break down what Banco's beta means in this case. As returns on the market increase, Banco DE returns are expected to increase less than the market. However, during the bear market, the loss on holding Banco DE will be expected to be smaller as well.
3 Months Beta |Analyze Banco DE Chile Demand Trend
Check current 90 days Banco DE correlation with market (DOW)

Banco Beta

    
  0.49  
Banco standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  1.94  
It is essential to understand the difference between upside risk (as represented by Banco DE's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Banco DE stock's daily returns or price. Since the actual investment returns on holding a position in Banco DE stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Banco DE.

Banco DE Chile Stock Volatility Analysis

Volatility refers to the frequency at which Banco DE stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Banco DE's price changes. Investors will then calculate the volatility of Banco DE's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Banco DE's volatility:

Historical Volatility

This type of stock volatility measures Banco DE's fluctuations based on previous trends. It's commonly used to predict Banco DE's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Banco DE's current market price. This means that the stock will return to its initially predicted market price.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Banco DE Chile Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
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Banco DE Projected Return Density Against Market

Considering the 90-day investment horizon Banco DE has a beta of 0.4905 suggesting as returns on the market go up, Banco DE average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Banco DE Chile will be expected to be much smaller as well.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Banco DE or Financial Services sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Banco DE stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Banco stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has a negative alpha, implying that the risk taken by holding this instrument is not justified. Banco DE Chile is significantly underperforming DOW.
 Predicted Return Density 
      Returns 
Banco DE's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how Banco DE stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Company's Stock Price Volatility?

Several factors can influence a company's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Banco DE Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Banco DE or Financial Services sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Banco DE stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Banco stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Considering the 90-day investment horizon the coefficient of variation of Banco DE is -581.72. The daily returns are distributed with a variance of 3.75 and standard deviation of 1.94. The mean deviation of Banco DE Chile is currently at 1.54. For similar time horizon, the selected benchmark (DOW) has volatility of 1.42
α
Alpha over DOW
-0.12
β
Beta against DOW0.49
σ
Overall volatility
1.94
Ir
Information ratio -0.01

Banco DE Stock Return Volatility

Banco DE historical daily return volatility represents how much Banco DE stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company has volatility of 1.9364% on return distribution over 90 days investment horizon. By contrast, DOW inherits 1.4608% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
      Timeline 

About Banco DE Volatility

Volatility is a rate at which the price of Banco DE or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Banco DE may increase or decrease. In other words, similar to Banco's beta indicator, it measures the risk of Banco DE and helps estimate the fluctuations that may happen in a short period of time. So if prices of Banco DE fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2022
Market Capitalization7.9 B9.2 B
Banco de Chile, together with its subsidiaries, provides banking and financial products and services to customers in Chile. Banco de Chile was founded in 1893 and is headquartered in Santiago, Chile. Banco DE operates under Banks - Regional classification in the United States and is traded on New York Stock Exchange.

Banco DE Investment Opportunity

Banco DE Chile has a volatility of 1.94 and is 1.33 times more volatile than DOW. 16  of all equities and portfolios are less risky than Banco DE. Compared to the overall equity markets, volatility of historical daily returns of Banco DE Chile is lower than 16 () of all global equities and portfolios over the last 90 days. Use Banco DE Chile to protect your portfolios against small market fluctuations. The stock experiences a very speculative upward sentiment. Check odds of Banco DE to be traded at $16.58 in 90 days. . Let's try to break down what Banco's beta means in this case. As returns on the market increase, Banco DE returns are expected to increase less than the market. However, during the bear market, the loss on holding Banco DE will be expected to be smaller as well.

Weak diversification

The correlation between Banco DE Chile and DJI is Weak diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Banco DE Chile and DJI in the same portfolio, assuming nothing else is changed.

Banco DE Additional Risk Indicators

The analysis of Banco DE's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Banco DE's investment and either accepting that risk or mitigating it. Along with some common measures of Banco DE stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance(0.15)
Market Risk Adjusted Performance(0.42)
Mean Deviation1.5
Coefficient Of Variation(929.71)
Standard Deviation1.88
Variance3.52
Information Ratio(0.010704)
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Banco DE Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Banco DE as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Banco DE's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Banco DE's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Banco DE Chile.
Continue to Trending Equities. Note that the Banco DE Chile information on this page should be used as a complementary analysis to other Banco DE's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.

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When running Banco DE Chile price analysis, check to measure Banco DE's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Banco DE is operating at the current time. Most of Banco DE's value examination focuses on studying past and present price action to predict the probability of Banco DE's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Banco DE's price. Additionally, you may evaluate how the addition of Banco DE to your portfolios can decrease your overall portfolio volatility.
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Is Banco DE's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Banco DE. If investors know Banco will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Banco DE listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
0.81
Market Capitalization
9.3 B
Quarterly Revenue Growth YOY
0.39
Return On Assets
0.0194
Return On Equity
0.23
The market value of Banco DE Chile is measured differently than its book value, which is the value of Banco that is recorded on the company's balance sheet. Investors also form their own opinion of Banco DE's value that differs from its market value or its book value, called intrinsic value, which is Banco DE's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Banco DE's market value can be influenced by many factors that don't directly affect Banco DE's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Banco DE's value and its price as these two are different measures arrived at by different means. Investors typically determine Banco DE value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Banco DE's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.