Correlation Between Bankwell Financial and VERTICAL
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By analyzing existing cross correlation between Bankwell Financial Group and VERTICAL HOLDCO GMBH, you can compare the effects of market volatilities on Bankwell Financial and VERTICAL 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 Bankwell Financial with a short position of VERTICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankwell Financial and VERTICAL.
Diversification Opportunities for Bankwell Financial and VERTICAL
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bankwell and VERTICAL is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Bankwell Financial Group and VERTICAL HOLDCO GMBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VERTICAL HOLDCO GMBH and Bankwell Financial 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 Bankwell Financial Group are associated (or correlated) with VERTICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VERTICAL HOLDCO GMBH has no effect on the direction of Bankwell Financial i.e., Bankwell Financial and VERTICAL go up and down completely randomly.
Pair Corralation between Bankwell Financial and VERTICAL
Given the investment horizon of 90 days Bankwell Financial Group is expected to generate 2.72 times more return on investment than VERTICAL. However, Bankwell Financial is 2.72 times more volatile than VERTICAL HOLDCO GMBH. It trades about 0.06 of its potential returns per unit of risk. VERTICAL HOLDCO GMBH is currently generating about -0.01 per unit of risk. If you would invest 2,388 in Bankwell Financial Group on November 3, 2024 and sell it today you would earn a total of 730.00 from holding Bankwell Financial Group or generate 30.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 83.87% |
| Values | Daily Returns |
Bankwell Financial Group vs. VERTICAL HOLDCO GMBH
Performance |
| Timeline |
| Bankwell Financial |
| VERTICAL HOLDCO GMBH |
Bankwell Financial and VERTICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankwell Financial and VERTICAL
The main advantage of trading using opposite Bankwell Financial and VERTICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankwell Financial position performs unexpectedly, VERTICAL 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 VERTICAL will offset losses from the drop in VERTICAL's long position.| Bankwell Financial vs. Franklin Financial Services | Bankwell Financial vs. The First Bancshares, | Bankwell Financial vs. Home Federal Bancorp | Bankwell Financial vs. Lake Shore Bancorp |
| VERTICAL vs. Albertsons Companies | VERTICAL vs. Sun Life Financial | VERTICAL vs. Delek Energy | VERTICAL vs. Lithia Motors |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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