Correlation Between Banque Cantonale and Basler Kantonalbank
Can any of the company-specific risk be diversified away by investing in both Banque Cantonale and Basler Kantonalbank 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 Cantonale and Basler Kantonalbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banque Cantonale and Basler Kantonalbank, you can compare the effects of market volatilities on Banque Cantonale and Basler Kantonalbank 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 Cantonale with a short position of Basler Kantonalbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banque Cantonale and Basler Kantonalbank.
Diversification Opportunities for Banque Cantonale and Basler Kantonalbank
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Banque and Basler is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Banque Cantonale and Basler Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basler Kantonalbank and Banque Cantonale 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 Cantonale are associated (or correlated) with Basler Kantonalbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basler Kantonalbank has no effect on the direction of Banque Cantonale i.e., Banque Cantonale and Basler Kantonalbank go up and down completely randomly.
Pair Corralation between Banque Cantonale and Basler Kantonalbank
Assuming the 90 days trading horizon Banque Cantonale is expected to under-perform the Basler Kantonalbank. In addition to that, Banque Cantonale is 2.65 times more volatile than Basler Kantonalbank. It trades about -0.07 of its total potential returns per unit of risk. Basler Kantonalbank is currently generating about -0.03 per unit of volatility. If you would invest 6,660 in Basler Kantonalbank on August 29, 2024 and sell it today you would lose (20.00) from holding Basler Kantonalbank or give up 0.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banque Cantonale vs. Basler Kantonalbank
Performance |
| Timeline |
| Banque Cantonale |
| Basler Kantonalbank |
Banque Cantonale and Basler Kantonalbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banque Cantonale and Basler Kantonalbank
The main advantage of trading using opposite Banque Cantonale and Basler Kantonalbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banque Cantonale position performs unexpectedly, Basler Kantonalbank 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 Basler Kantonalbank will offset losses from the drop in Basler Kantonalbank's long position.| Banque Cantonale vs. Santhera Pharmaceuticals Holding | Banque Cantonale vs. Newron Pharmaceuticals SpA | Banque Cantonale vs. Basilea Pharmaceutica AG | Banque Cantonale vs. Evolva Holding SA |
| Basler Kantonalbank vs. Banque Cantonale | Basler Kantonalbank vs. Berner Kantonalbank AG | Basler Kantonalbank vs. Luzerner Kantonalbank AG | Basler Kantonalbank vs. Banque Cantonale de |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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