Correlation Between BEO Bancorp and Bank Utica
Can any of the company-specific risk be diversified away by investing in both BEO Bancorp and Bank Utica 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 BEO Bancorp and Bank Utica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BEO Bancorp and Bank Utica Ny, you can compare the effects of market volatilities on BEO Bancorp and Bank Utica 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 BEO Bancorp with a short position of Bank Utica. Check out your portfolio center. Please also check ongoing floating volatility patterns of BEO Bancorp and Bank Utica.
Diversification Opportunities for BEO Bancorp and Bank Utica
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BEO and Bank is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding BEO Bancorp and Bank Utica Ny in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Utica Ny and BEO Bancorp 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 BEO Bancorp are associated (or correlated) with Bank Utica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Utica Ny has no effect on the direction of BEO Bancorp i.e., BEO Bancorp and Bank Utica go up and down completely randomly.
Pair Corralation between BEO Bancorp and Bank Utica
Given the investment horizon of 90 days BEO Bancorp is expected to generate 13.43 times less return on investment than Bank Utica. But when comparing it to its historical volatility, BEO Bancorp is 3.1 times less risky than Bank Utica. It trades about 0.05 of its potential returns per unit of risk. Bank Utica Ny is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 43,800 in Bank Utica Ny on August 29, 2024 and sell it today you would earn a total of 3,700 from holding Bank Utica Ny or generate 8.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BEO Bancorp vs. Bank Utica Ny
Performance |
| Timeline |
| BEO Bancorp |
| Bank Utica Ny |
BEO Bancorp and Bank Utica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BEO Bancorp and Bank Utica
The main advantage of trading using opposite BEO Bancorp and Bank Utica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BEO Bancorp position performs unexpectedly, Bank Utica 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 Bank Utica will offset losses from the drop in Bank Utica's long position.| BEO Bancorp vs. CCSB Financial Corp | BEO Bancorp vs. Delhi Bank Corp | BEO Bancorp vs. First Community Financial | BEO Bancorp vs. First Community |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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