Correlation Between US Global and Bank of New York
Can any of the company-specific risk be diversified away by investing in both US Global and Bank of New York 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 US Global and Bank of New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Global Investors and Bank of New, you can compare the effects of market volatilities on US Global and Bank of New York 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 US Global with a short position of Bank of New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Global and Bank of New York.
Diversification Opportunities for US Global and Bank of New York
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GROW and Bank is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding US Global Investors and Bank of New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of New York and US Global 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 US Global Investors are associated (or correlated) with Bank of New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of New York has no effect on the direction of US Global i.e., US Global and Bank of New York go up and down completely randomly.
Pair Corralation between US Global and Bank of New York
Given the investment horizon of 90 days US Global Investors is expected to under-perform the Bank of New York. In addition to that, US Global is 1.06 times more volatile than Bank of New. It trades about -0.02 of its total potential returns per unit of risk. Bank of New is currently generating about 0.24 per unit of volatility. If you would invest 5,807 in Bank of New on September 2, 2024 and sell it today you would earn a total of 2,380 from holding Bank of New or generate 40.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
US Global Investors vs. Bank of New
Performance |
| Timeline |
| US Global Investors |
| Bank of New York |
US Global and Bank of New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Global and Bank of New York
The main advantage of trading using opposite US Global and Bank of New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Global position performs unexpectedly, Bank of New York 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 Bank of New York will offset losses from the drop in Bank of New York's long position.| US Global vs. Gladstone Investment | US Global vs. PennantPark Floating Rate | US Global vs. Horizon Technology Finance | US Global vs. Stellus Capital Investment |
| Bank of New York vs. Northern Trust | Bank of New York vs. Invesco Plc | Bank of New York vs. Franklin Resources | Bank of New York vs. T Rowe Price |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |