Correlation Between Baraboo Bancorporation and Aozora Bank
Can any of the company-specific risk be diversified away by investing in both Baraboo Bancorporation and Aozora Bank 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 Baraboo Bancorporation and Aozora Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baraboo Bancorporation and Aozora Bank, you can compare the effects of market volatilities on Baraboo Bancorporation and Aozora Bank 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 Baraboo Bancorporation with a short position of Aozora Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baraboo Bancorporation and Aozora Bank.
Diversification Opportunities for Baraboo Bancorporation and Aozora Bank
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Baraboo and Aozora is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Baraboo Bancorp. and Aozora Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aozora Bank and Baraboo Bancorporation 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 Baraboo Bancorporation are associated (or correlated) with Aozora Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aozora Bank has no effect on the direction of Baraboo Bancorporation i.e., Baraboo Bancorporation and Aozora Bank go up and down completely randomly.
Pair Corralation between Baraboo Bancorporation and Aozora Bank
If you would invest 310.00 in Baraboo Bancorporation on August 25, 2024 and sell it today you would earn a total of 13.00 from holding Baraboo Bancorporation or generate 4.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Baraboo Bancorp. vs. Aozora Bank
Performance |
| Timeline |
| Baraboo Bancorporation |
| Aozora Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Baraboo Bancorporation and Aozora Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baraboo Bancorporation and Aozora Bank
The main advantage of trading using opposite Baraboo Bancorporation and Aozora Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baraboo Bancorporation position performs unexpectedly, Aozora Bank 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 Aozora Bank will offset losses from the drop in Aozora Bank's long position.| Baraboo Bancorporation vs. Standard Bank Group | Baraboo Bancorporation vs. Bank Central Asia | Baraboo Bancorporation vs. PSB Holdings | Baraboo Bancorporation vs. United Overseas Bank |
| Aozora Bank vs. Chester Mining | Aozora Bank vs. Papaya Growth Opportunity | Aozora Bank vs. Aldel Financial II | Aozora Bank vs. WiMi Hologram Cloud |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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