Correlation Between Eastman Kodak and Metropolitan Bank
Can any of the company-specific risk be diversified away by investing in both Eastman Kodak and Metropolitan Bank 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 Eastman Kodak and Metropolitan Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Kodak Co and Metropolitan Bank and, you can compare the effects of market volatilities on Eastman Kodak and Metropolitan Bank 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 Eastman Kodak with a short position of Metropolitan Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Kodak and Metropolitan Bank.
Diversification Opportunities for Eastman Kodak and Metropolitan Bank
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eastman and Metropolitan is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Kodak Co and Metropolitan Bank and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metropolitan Bank and Eastman Kodak 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 Eastman Kodak Co are associated (or correlated) with Metropolitan Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metropolitan Bank has no effect on the direction of Eastman Kodak i.e., Eastman Kodak and Metropolitan Bank go up and down completely randomly.
Pair Corralation between Eastman Kodak and Metropolitan Bank
Given the investment horizon of 90 days Eastman Kodak Co is expected to generate 1.63 times more return on investment than Metropolitan Bank. However, Eastman Kodak is 1.63 times more volatile than Metropolitan Bank and. It trades about 0.05 of its potential returns per unit of risk. Metropolitan Bank and is currently generating about 0.04 per unit of risk. If you would invest 361.00 in Eastman Kodak Co on October 22, 2024 and sell it today you would earn a total of 367.00 from holding Eastman Kodak Co or generate 101.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Eastman Kodak Co vs. Metropolitan Bank and
Performance |
| Timeline |
| Eastman Kodak |
| Metropolitan Bank |
Eastman Kodak and Metropolitan Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Kodak and Metropolitan Bank
The main advantage of trading using opposite Eastman Kodak and Metropolitan Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Kodak position performs unexpectedly, Metropolitan Bank 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 Metropolitan Bank will offset losses from the drop in Metropolitan Bank's long position.| Eastman Kodak vs. SMX Public Limited | Eastman Kodak vs. System1 | Eastman Kodak vs. Lichen China Limited | Eastman Kodak vs. Team Inc |
| Metropolitan Bank vs. Century Next Financial | Metropolitan Bank vs. Triad Business Bank | Metropolitan Bank vs. First Ottawa Bancshares | Metropolitan Bank vs. First Community Financial |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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