Correlation Between ChoiceOne Financial and KeyCorp
Can any of the company-specific risk be diversified away by investing in both ChoiceOne Financial 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 ChoiceOne Financial and KeyCorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChoiceOne Financial Services and KeyCorp, you can compare the effects of market volatilities on ChoiceOne Financial 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 ChoiceOne Financial with a short position of KeyCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChoiceOne Financial and KeyCorp.
Diversification Opportunities for ChoiceOne Financial and KeyCorp
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ChoiceOne and KeyCorp is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding ChoiceOne Financial Services and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp and ChoiceOne 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 ChoiceOne Financial Services 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 ChoiceOne Financial i.e., ChoiceOne Financial and KeyCorp go up and down completely randomly.
Pair Corralation between ChoiceOne Financial and KeyCorp
Given the investment horizon of 90 days ChoiceOne Financial is expected to generate 1.02 times less return on investment than KeyCorp. But when comparing it to its historical volatility, ChoiceOne Financial Services is 1.81 times less risky than KeyCorp. It trades about 0.27 of its potential returns per unit of risk. KeyCorp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,749 in KeyCorp on August 31, 2024 and sell it today you would earn a total of 203.00 from holding KeyCorp or generate 11.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChoiceOne Financial Services vs. KeyCorp
Performance |
| Timeline |
| ChoiceOne Financial |
| KeyCorp |
ChoiceOne Financial and KeyCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChoiceOne Financial and KeyCorp
The main advantage of trading using opposite ChoiceOne Financial and KeyCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChoiceOne Financial 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.| ChoiceOne Financial vs. KeyCorp | ChoiceOne Financial vs. Comerica | ChoiceOne Financial vs. First Horizon National | ChoiceOne Financial vs. Western Alliance Bancorporation |
| 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |