Correlation Between KeyCorp and ChoiceOne Financial
Can any of the company-specific risk be diversified away by investing in both KeyCorp and ChoiceOne Financial 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 ChoiceOne Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KeyCorp and ChoiceOne Financial Services, you can compare the effects of market volatilities on KeyCorp and ChoiceOne Financial 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 ChoiceOne Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of KeyCorp and ChoiceOne Financial.
Diversification Opportunities for KeyCorp and ChoiceOne Financial
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between KeyCorp and ChoiceOne is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding KeyCorp and ChoiceOne Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChoiceOne Financial 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 ChoiceOne Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChoiceOne Financial has no effect on the direction of KeyCorp i.e., KeyCorp and ChoiceOne Financial go up and down completely randomly.
Pair Corralation between KeyCorp and ChoiceOne Financial
Considering the 90-day investment horizon KeyCorp is expected to generate 1.3 times less return on investment than ChoiceOne Financial. In addition to that, KeyCorp is 1.11 times more volatile than ChoiceOne Financial Services. It trades about 0.03 of its total potential returns per unit of risk. ChoiceOne Financial Services is currently generating about 0.04 per unit of volatility. If you would invest 2,646 in ChoiceOne Financial Services on August 31, 2024 and sell it today you would earn a total of 1,081 from holding ChoiceOne Financial Services or generate 40.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
KeyCorp vs. ChoiceOne Financial Services
Performance |
| Timeline |
| KeyCorp |
| ChoiceOne Financial |
KeyCorp and ChoiceOne Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KeyCorp and ChoiceOne Financial
The main advantage of trading using opposite KeyCorp and ChoiceOne Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KeyCorp position performs unexpectedly, ChoiceOne Financial 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 ChoiceOne Financial will offset losses from the drop in ChoiceOne Financial's long position.| KeyCorp vs. Western Alliance Bancorporation | KeyCorp vs. Comerica | KeyCorp vs. Truist Financial Corp | KeyCorp vs. Fifth Third Bancorp |
| ChoiceOne Financial vs. KeyCorp | ChoiceOne Financial vs. Comerica | ChoiceOne Financial vs. First Horizon National | ChoiceOne Financial vs. Western Alliance Bancorporation |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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