Correlation Between Bank of Hawaii and KeyCorp
Can any of the company-specific risk be diversified away by investing in both Bank of Hawaii and KeyCorp 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 Hawaii and KeyCorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of Hawaii and KeyCorp, you can compare the effects of market volatilities on Bank of Hawaii and KeyCorp 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 Hawaii with a short position of KeyCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Hawaii and KeyCorp.
Diversification Opportunities for Bank of Hawaii and KeyCorp
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and KeyCorp is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Hawaii and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp and Bank of Hawaii 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 Hawaii are associated (or correlated) with KeyCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KeyCorp has no effect on the direction of Bank of Hawaii i.e., Bank of Hawaii and KeyCorp go up and down completely randomly.
Pair Corralation between Bank of Hawaii and KeyCorp
Assuming the 90 days trading horizon Bank of Hawaii is expected to generate 2.24 times less return on investment than KeyCorp. But when comparing it to its historical volatility, Bank of Hawaii is 1.34 times less risky than KeyCorp. It trades about 0.02 of its potential returns per unit of risk. KeyCorp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,552 in KeyCorp on September 3, 2024 and sell it today you would earn a total of 396.00 from holding KeyCorp or generate 25.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Hawaii vs. KeyCorp
Performance |
| Timeline |
| Bank of Hawaii |
| KeyCorp |
Bank of Hawaii and KeyCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Hawaii and KeyCorp
The main advantage of trading using opposite Bank of Hawaii and KeyCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Hawaii position performs unexpectedly, KeyCorp 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 KeyCorp will offset losses from the drop in KeyCorp's long position.| Bank of Hawaii vs. Morgan Stanley | Bank of Hawaii vs. KeyCorp | Bank of Hawaii vs. KeyCorp | Bank of Hawaii vs. KeyCorp |
| KeyCorp vs. JPMorgan Chase Co | KeyCorp vs. Citigroup | KeyCorp vs. Wells Fargo | KeyCorp vs. Toronto Dominion Bank |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |