Correlation Between Chiba Bank and Kinsale Capital
Can any of the company-specific risk be diversified away by investing in both Chiba Bank and Kinsale Capital 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 Chiba Bank and Kinsale Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank Ltd and Kinsale Capital Group, you can compare the effects of market volatilities on Chiba Bank and Kinsale Capital 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 Chiba Bank with a short position of Kinsale Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and Kinsale Capital.
Diversification Opportunities for Chiba Bank and Kinsale Capital
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Chiba and Kinsale is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank Ltd and Kinsale Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinsale Capital Group and Chiba Bank 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 Chiba Bank Ltd are associated (or correlated) with Kinsale Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinsale Capital Group has no effect on the direction of Chiba Bank i.e., Chiba Bank and Kinsale Capital go up and down completely randomly.
Pair Corralation between Chiba Bank and Kinsale Capital
Assuming the 90 days horizon Chiba Bank is expected to generate 16.02 times less return on investment than Kinsale Capital. But when comparing it to its historical volatility, Chiba Bank Ltd is 3.35 times less risky than Kinsale Capital. It trades about 0.02 of its potential returns per unit of risk. Kinsale Capital Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 38,038 in Kinsale Capital Group on September 2, 2024 and sell it today you would earn a total of 12,806 from holding Kinsale Capital Group or generate 33.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiba Bank Ltd vs. Kinsale Capital Group
Performance |
| Timeline |
| Chiba Bank |
| Kinsale Capital Group |
Chiba Bank and Kinsale Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and Kinsale Capital
The main advantage of trading using opposite Chiba Bank and Kinsale Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank position performs unexpectedly, Kinsale Capital 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 Kinsale Capital will offset losses from the drop in Kinsale Capital's long position.| Chiba Bank vs. Piraeus Bank SA | Chiba Bank vs. Turkiye Garanti Bankasi | Chiba Bank vs. Uwharrie Capital Corp |
| Kinsale Capital vs. Selective Insurance Group | Kinsale Capital vs. Horace Mann Educators | Kinsale Capital vs. Kemper | Kinsale Capital vs. ProAssurance |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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