Correlation Between KBC Groep and Baraboo Bancorporation
Can any of the company-specific risk be diversified away by investing in both KBC Groep and Baraboo Bancorporation 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 KBC Groep and Baraboo Bancorporation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KBC Groep NV and Baraboo Bancorporation, you can compare the effects of market volatilities on KBC Groep and Baraboo Bancorporation 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 KBC Groep with a short position of Baraboo Bancorporation. Check out your portfolio center. Please also check ongoing floating volatility patterns of KBC Groep and Baraboo Bancorporation.
Diversification Opportunities for KBC Groep and Baraboo Bancorporation
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KBC and Baraboo is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding KBC Groep NV and Baraboo Bancorp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baraboo Bancorporation and KBC Groep 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 KBC Groep NV are associated (or correlated) with Baraboo Bancorporation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baraboo Bancorporation has no effect on the direction of KBC Groep i.e., KBC Groep and Baraboo Bancorporation go up and down completely randomly.
Pair Corralation between KBC Groep and Baraboo Bancorporation
Assuming the 90 days horizon KBC Groep NV is expected to generate 0.45 times more return on investment than Baraboo Bancorporation. However, KBC Groep NV is 2.23 times less risky than Baraboo Bancorporation. It trades about 0.05 of its potential returns per unit of risk. Baraboo Bancorporation is currently generating about 0.02 per unit of risk. If you would invest 2,561 in KBC Groep NV on August 30, 2024 and sell it today you would earn a total of 999.00 from holding KBC Groep NV or generate 39.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.45% |
| Values | Daily Returns |
KBC Groep NV vs. Baraboo Bancorp.
Performance |
| Timeline |
| KBC Groep NV |
| Baraboo Bancorporation |
KBC Groep and Baraboo Bancorporation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KBC Groep and Baraboo Bancorporation
The main advantage of trading using opposite KBC Groep and Baraboo Bancorporation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KBC Groep position performs unexpectedly, Baraboo Bancorporation 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 Baraboo Bancorporation will offset losses from the drop in Baraboo Bancorporation's long position.| KBC Groep vs. DBS Group Holdings | KBC Groep vs. United Overseas Bank | KBC Groep vs. Overseas Chinese Banking | KBC Groep vs. China Minsh |
| Baraboo Bancorporation vs. Andover Bancorp | Baraboo Bancorporation vs. Aozora Bank Ltd | Baraboo Bancorporation vs. Israel Discount Bank | Baraboo Bancorporation vs. Schweizerische Nationalbank |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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