Correlation Between Glarner Kantonalbank and Basler Kantonalbank
Can any of the company-specific risk be diversified away by investing in both Glarner Kantonalbank and Basler Kantonalbank 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 Glarner Kantonalbank and Basler Kantonalbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glarner Kantonalbank and Basler Kantonalbank, you can compare the effects of market volatilities on Glarner Kantonalbank and Basler Kantonalbank 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 Glarner Kantonalbank with a short position of Basler Kantonalbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glarner Kantonalbank and Basler Kantonalbank.
Diversification Opportunities for Glarner Kantonalbank and Basler Kantonalbank
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Glarner and Basler is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Glarner Kantonalbank and Basler Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basler Kantonalbank and Glarner Kantonalbank 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 Glarner Kantonalbank are associated (or correlated) with Basler Kantonalbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basler Kantonalbank has no effect on the direction of Glarner Kantonalbank i.e., Glarner Kantonalbank and Basler Kantonalbank go up and down completely randomly.
Pair Corralation between Glarner Kantonalbank and Basler Kantonalbank
Assuming the 90 days trading horizon Glarner Kantonalbank is expected to under-perform the Basler Kantonalbank. In addition to that, Glarner Kantonalbank is 2.06 times more volatile than Basler Kantonalbank. It trades about -0.17 of its total potential returns per unit of risk. Basler Kantonalbank is currently generating about -0.03 per unit of volatility. If you would invest 6,660 in Basler Kantonalbank on August 29, 2024 and sell it today you would lose (20.00) from holding Basler Kantonalbank or give up 0.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Glarner Kantonalbank vs. Basler Kantonalbank
Performance |
| Timeline |
| Glarner Kantonalbank |
| Basler Kantonalbank |
Glarner Kantonalbank and Basler Kantonalbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glarner Kantonalbank and Basler Kantonalbank
The main advantage of trading using opposite Glarner Kantonalbank and Basler Kantonalbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glarner Kantonalbank position performs unexpectedly, Basler Kantonalbank 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 Basler Kantonalbank will offset losses from the drop in Basler Kantonalbank's long position.| Glarner Kantonalbank vs. Berner Kantonalbank AG | Glarner Kantonalbank vs. Luzerner Kantonalbank AG | Glarner Kantonalbank vs. Banque Cantonale | Glarner Kantonalbank vs. Liechtensteinische Landesbank AG |
| Basler Kantonalbank vs. Banque Cantonale | Basler Kantonalbank vs. Berner Kantonalbank AG | Basler Kantonalbank vs. Luzerner Kantonalbank AG | Basler Kantonalbank vs. Banque Cantonale de |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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