Correlation Between Glacier Bancorp and Sumitomo Electric
Can any of the company-specific risk be diversified away by investing in both Glacier Bancorp and Sumitomo Electric 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 Glacier Bancorp and Sumitomo Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glacier Bancorp and Sumitomo Electric Industries, you can compare the effects of market volatilities on Glacier Bancorp and Sumitomo Electric 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 Glacier Bancorp with a short position of Sumitomo Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glacier Bancorp and Sumitomo Electric.
Diversification Opportunities for Glacier Bancorp and Sumitomo Electric
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Glacier and Sumitomo is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Glacier Bancorp and Sumitomo Electric Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumitomo Electric and Glacier Bancorp 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 Glacier Bancorp are associated (or correlated) with Sumitomo Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumitomo Electric has no effect on the direction of Glacier Bancorp i.e., Glacier Bancorp and Sumitomo Electric go up and down completely randomly.
Pair Corralation between Glacier Bancorp and Sumitomo Electric
Given the investment horizon of 90 days Glacier Bancorp is expected to generate 2.04 times more return on investment than Sumitomo Electric. However, Glacier Bancorp is 2.04 times more volatile than Sumitomo Electric Industries. It trades about 0.09 of its potential returns per unit of risk. Sumitomo Electric Industries is currently generating about 0.08 per unit of risk. If you would invest 3,198 in Glacier Bancorp on August 26, 2024 and sell it today you would earn a total of 2,635 from holding Glacier Bancorp or generate 82.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glacier Bancorp vs. Sumitomo Electric Industries
Performance |
| Timeline |
| Glacier Bancorp |
| Sumitomo Electric |
Glacier Bancorp and Sumitomo Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glacier Bancorp and Sumitomo Electric
The main advantage of trading using opposite Glacier Bancorp and Sumitomo Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glacier Bancorp position performs unexpectedly, Sumitomo Electric 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 Sumitomo Electric will offset losses from the drop in Sumitomo Electric's long position.| Glacier Bancorp vs. CVB Financial | Glacier Bancorp vs. Independent Bank Group | Glacier Bancorp vs. Columbia Banking System | Glacier Bancorp vs. First Financial Bankshares |
| Sumitomo Electric vs. Getty Images Holdings | Sumitomo Electric vs. Glacier Bancorp | Sumitomo Electric vs. Juniata Valley Financial | Sumitomo Electric vs. Encore Capital Group |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |