Correlation Between Bankers Investment and Cintas Corp
Can any of the company-specific risk be diversified away by investing in both Bankers Investment and Cintas Corp 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 Bankers Investment and Cintas Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankers Investment Trust and Cintas Corp, you can compare the effects of market volatilities on Bankers Investment and Cintas Corp 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 Bankers Investment with a short position of Cintas Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankers Investment and Cintas Corp.
Diversification Opportunities for Bankers Investment and Cintas Corp
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bankers and Cintas is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Bankers Investment Trust and Cintas Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cintas Corp and Bankers Investment 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 Bankers Investment Trust are associated (or correlated) with Cintas Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cintas Corp has no effect on the direction of Bankers Investment i.e., Bankers Investment and Cintas Corp go up and down completely randomly.
Pair Corralation between Bankers Investment and Cintas Corp
Assuming the 90 days trading horizon Bankers Investment Trust is expected to generate 0.24 times more return on investment than Cintas Corp. However, Bankers Investment Trust is 4.15 times less risky than Cintas Corp. It trades about 0.07 of its potential returns per unit of risk. Cintas Corp is currently generating about -0.12 per unit of risk. If you would invest 11,540 in Bankers Investment Trust on September 14, 2024 and sell it today you would earn a total of 80.00 from holding Bankers Investment Trust or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bankers Investment Trust vs. Cintas Corp
Performance |
| Timeline |
| Bankers Investment Trust |
| Cintas Corp |
Bankers Investment and Cintas Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankers Investment and Cintas Corp
The main advantage of trading using opposite Bankers Investment and Cintas Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankers Investment position performs unexpectedly, Cintas Corp 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 Cintas Corp will offset losses from the drop in Cintas Corp's long position.| Bankers Investment vs. Catalyst Media Group | Bankers Investment vs. CATLIN GROUP | Bankers Investment vs. Tamburi Investment Partners | Bankers Investment vs. Magnora ASA |
| Cintas Corp vs. Cizzle Biotechnology Holdings | Cintas Corp vs. Cornish Metals | Cintas Corp vs. Panther Metals PLC | Cintas Corp vs. Young Cos Brewery |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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