Correlation Between BMCI and CFG BANK
Specify exactly 2 symbols:
By analyzing existing cross correlation between BMCI and CFG BANK, you can compare the effects of market volatilities on BMCI and CFG 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 BMCI with a short position of CFG BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of BMCI and CFG BANK.
Diversification Opportunities for BMCI and CFG BANK
Very good diversification
The 3 months correlation between BMCI and CFG is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding BMCI and CFG BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CFG BANK and BMCI 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 BMCI are associated (or correlated) with CFG BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CFG BANK has no effect on the direction of BMCI i.e., BMCI and CFG BANK go up and down completely randomly.
Pair Corralation between BMCI and CFG BANK
Assuming the 90 days trading horizon BMCI is expected to under-perform the CFG BANK. In addition to that, BMCI is 1.76 times more volatile than CFG BANK. It trades about -0.04 of its total potential returns per unit of risk. CFG BANK is currently generating about 0.16 per unit of volatility. If you would invest 18,800 in CFG BANK on August 30, 2024 and sell it today you would earn a total of 2,100 from holding CFG BANK or generate 11.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
BMCI vs. CFG BANK
Performance |
| Timeline |
| BMCI |
| CFG BANK |
BMCI and CFG BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BMCI and CFG BANK
The main advantage of trading using opposite BMCI and CFG BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BMCI position performs unexpectedly, CFG 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 CFG BANK will offset losses from the drop in CFG BANK's long position.The idea behind BMCI and CFG BANK pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |