Correlation Between Camden National and KeyCorp
Can any of the company-specific risk be diversified away by investing in both Camden National 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 Camden National and KeyCorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camden National and KeyCorp, you can compare the effects of market volatilities on Camden National 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 Camden National with a short position of KeyCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camden National and KeyCorp.
Diversification Opportunities for Camden National and KeyCorp
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Camden and KeyCorp is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Camden National and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp and Camden National 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 Camden National 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 Camden National i.e., Camden National and KeyCorp go up and down completely randomly.
Pair Corralation between Camden National and KeyCorp
Considering the 90-day investment horizon Camden National is expected to generate 1.09 times less return on investment than KeyCorp. In addition to that, Camden National is 1.03 times more volatile than KeyCorp. It trades about 0.16 of its total potential returns per unit of risk. KeyCorp is currently generating about 0.18 per unit of volatility. If you would invest 1,719 in KeyCorp on September 2, 2024 and sell it today you would earn a total of 229.00 from holding KeyCorp or generate 13.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Camden National vs. KeyCorp
Performance |
| Timeline |
| Camden National |
| KeyCorp |
Camden National and KeyCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camden National and KeyCorp
The main advantage of trading using opposite Camden National and KeyCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camden National 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.| Camden National vs. First United | Camden National vs. First Community | Camden National vs. Greene County Bancorp | Camden National vs. Community West Bancshares |
| KeyCorp vs. Western Alliance Bancorporation | KeyCorp vs. Comerica | KeyCorp vs. Truist Financial Corp | KeyCorp vs. Fifth Third Bancorp |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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