Correlation Between Blue Ridge and KS Bancorp
Can any of the company-specific risk be diversified away by investing in both Blue Ridge and KS Bancorp 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 Blue Ridge and KS Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Ridge Bankshares and KS Bancorp, you can compare the effects of market volatilities on Blue Ridge and KS Bancorp 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 Blue Ridge with a short position of KS Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Ridge and KS Bancorp.
Diversification Opportunities for Blue Ridge and KS Bancorp
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Blue and KSBI is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Blue Ridge Bankshares and KS Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KS Bancorp and Blue Ridge 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 Blue Ridge Bankshares are associated (or correlated) with KS Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KS Bancorp has no effect on the direction of Blue Ridge i.e., Blue Ridge and KS Bancorp go up and down completely randomly.
Pair Corralation between Blue Ridge and KS Bancorp
Given the investment horizon of 90 days Blue Ridge Bankshares is expected to generate 18.38 times more return on investment than KS Bancorp. However, Blue Ridge is 18.38 times more volatile than KS Bancorp. It trades about 0.18 of its potential returns per unit of risk. KS Bancorp is currently generating about -0.16 per unit of risk. If you would invest 296.00 in Blue Ridge Bankshares on August 30, 2024 and sell it today you would earn a total of 50.00 from holding Blue Ridge Bankshares or generate 16.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Ridge Bankshares vs. KS Bancorp
Performance |
| Timeline |
| Blue Ridge Bankshares |
| KS Bancorp |
Blue Ridge and KS Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Ridge and KS Bancorp
The main advantage of trading using opposite Blue Ridge and KS Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Ridge position performs unexpectedly, KS Bancorp 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 KS Bancorp will offset losses from the drop in KS Bancorp's long position.| Blue Ridge vs. LINKBANCORP | Blue Ridge vs. Colony Bankcorp | Blue Ridge vs. Bankwell Financial Group | Blue Ridge vs. ECB Bancorp |
| KS Bancorp vs. Invesco High Income | KS Bancorp vs. Blackrock Muniholdings Ny | KS Bancorp vs. Nuveen California Select | KS Bancorp vs. MFS Investment Grade |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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