Correlation Between KeyCorp and Binah Capital
Can any of the company-specific risk be diversified away by investing in both KeyCorp and Binah Capital 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 KeyCorp and Binah Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KeyCorp and Binah Capital Group,, you can compare the effects of market volatilities on KeyCorp and Binah Capital 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 KeyCorp with a short position of Binah Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of KeyCorp and Binah Capital.
Diversification Opportunities for KeyCorp and Binah Capital
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KeyCorp and Binah is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding KeyCorp and Binah Capital Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binah Capital Group, and KeyCorp 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 KeyCorp are associated (or correlated) with Binah Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binah Capital Group, has no effect on the direction of KeyCorp i.e., KeyCorp and Binah Capital go up and down completely randomly.
Pair Corralation between KeyCorp and Binah Capital
Assuming the 90 days trading horizon KeyCorp is expected to under-perform the Binah Capital. But the preferred stock apears to be less risky and, when comparing its historical volatility, KeyCorp is 51.7 times less risky than Binah Capital. The preferred stock trades about -0.03 of its potential returns per unit of risk. The Binah Capital Group, is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 3.40 in Binah Capital Group, on August 28, 2024 and sell it today you would earn a total of 3.59 from holding Binah Capital Group, or generate 105.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
KeyCorp vs. Binah Capital Group,
Performance |
| Timeline |
| KeyCorp |
| Binah Capital Group, |
KeyCorp and Binah Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KeyCorp and Binah Capital
The main advantage of trading using opposite KeyCorp and Binah Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KeyCorp position performs unexpectedly, Binah Capital 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 Binah Capital will offset losses from the drop in Binah Capital's long position.The idea behind KeyCorp and Binah Capital Group, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Binah Capital vs. Fomento Economico Mexicano | Binah Capital vs. Diageo PLC ADR | Binah Capital vs. Sweetgreen | Binah Capital vs. RCI Hospitality Holdings |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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