Correlation Between Bank of New York and Lion One
Can any of the company-specific risk be diversified away by investing in both Bank of New York and Lion One 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 Bank of New York and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of New and Lion One Metals, you can compare the effects of market volatilities on Bank of New York and Lion One 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 Bank of New York with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of New York and Lion One.
Diversification Opportunities for Bank of New York and Lion One
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Lion is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Bank of New and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and Bank of New York 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 Bank of New are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of Bank of New York i.e., Bank of New York and Lion One go up and down completely randomly.
Pair Corralation between Bank of New York and Lion One
Allowing for the 90-day total investment horizon Bank of New is expected to generate 0.27 times more return on investment than Lion One. However, Bank of New is 3.64 times less risky than Lion One. It trades about 0.12 of its potential returns per unit of risk. Lion One Metals is currently generating about -0.27 per unit of risk. If you would invest 7,795 in Bank of New on September 13, 2024 and sell it today you would earn a total of 172.00 from holding Bank of New or generate 2.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of New vs. Lion One Metals
Performance |
| Timeline |
| Bank of New York |
| Lion One Metals |
Bank of New York and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of New York and Lion One
The main advantage of trading using opposite Bank of New York and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of New York position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| Bank of New York vs. Northern Trust | Bank of New York vs. Invesco Plc | Bank of New York vs. Franklin Resources | Bank of New York vs. T Rowe Price |
| Lion One vs. Advantage Solutions | Lion One vs. Atlas Corp | Lion One vs. PureCycle Technologies | Lion One vs. WM Technology |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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