Correlation Between KeyCorp and Sterling Bancorp
Can any of the company-specific risk be diversified away by investing in both KeyCorp and Sterling Bancorp 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 Sterling Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KeyCorp and Sterling Bancorp, you can compare the effects of market volatilities on KeyCorp and Sterling Bancorp 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 Sterling Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of KeyCorp and Sterling Bancorp.
Diversification Opportunities for KeyCorp and Sterling Bancorp
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between KeyCorp and Sterling is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding KeyCorp and Sterling Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Bancorp 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 Sterling Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Bancorp has no effect on the direction of KeyCorp i.e., KeyCorp and Sterling Bancorp go up and down completely randomly.
Pair Corralation between KeyCorp and Sterling Bancorp
Assuming the 90 days trading horizon KeyCorp is expected to generate 2.21 times less return on investment than Sterling Bancorp. But when comparing it to its historical volatility, KeyCorp is 1.33 times less risky than Sterling Bancorp. It trades about 0.1 of its potential returns per unit of risk. Sterling Bancorp is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 466.00 in Sterling Bancorp on August 26, 2024 and sell it today you would earn a total of 18.00 from holding Sterling Bancorp or generate 3.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KeyCorp vs. Sterling Bancorp
Performance |
| Timeline |
| KeyCorp |
| Sterling Bancorp |
KeyCorp and Sterling Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KeyCorp and Sterling Bancorp
The main advantage of trading using opposite KeyCorp and Sterling Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KeyCorp position performs unexpectedly, Sterling Bancorp 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 Sterling Bancorp will offset losses from the drop in Sterling Bancorp's long position.| KeyCorp vs. KeyCorp | KeyCorp vs. Regions Financial | KeyCorp vs. US Bancorp | KeyCorp vs. Fifth Third Bancorp |
| Sterling Bancorp vs. Home Federal Bancorp | Sterling Bancorp vs. Lake Shore Bancorp | Sterling Bancorp vs. Magyar Bancorp | Sterling Bancorp vs. Franklin Financial Services |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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