Correlation Between KeyCorp and New York
Can any of the company-specific risk be diversified away by investing in both KeyCorp and 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 KeyCorp and New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KeyCorp and New York Community, you can compare the effects of market volatilities on KeyCorp and 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 KeyCorp with a short position of New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of KeyCorp and New York.
Diversification Opportunities for KeyCorp and New York
Very poor diversification
The 3 months correlation between KeyCorp and New is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding KeyCorp and New York Community in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New York Community 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 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 New York Community has no effect on the direction of KeyCorp i.e., KeyCorp and New York go up and down completely randomly.
Pair Corralation between KeyCorp and New York
Assuming the 90 days trading horizon KeyCorp is expected to generate 1.0 times more return on investment than New York. However, KeyCorp is 1.0 times less risky than New York. It trades about 0.02 of its potential returns per unit of risk. New York Community is currently generating about 0.02 per unit of risk. If you would invest 2,065 in KeyCorp on August 26, 2024 and sell it today you would earn a total of 308.00 from holding KeyCorp or generate 14.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
KeyCorp vs. New York Community
Performance |
| Timeline |
| KeyCorp |
| New York Community |
KeyCorp and New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KeyCorp and New York
The main advantage of trading using opposite KeyCorp and New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KeyCorp position performs unexpectedly, 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 New York will offset losses from the drop in New York's long position.| KeyCorp vs. KeyCorp | KeyCorp vs. Regions Financial | KeyCorp vs. US Bancorp | KeyCorp vs. Fifth Third Bancorp |
| New York vs. Wintrust Financial Corp | New York vs. Pinnacle Financial Partners | New York vs. Associated Banc Corp | New York vs. WesBanco |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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