Correlation Between Nasdaq and KEYBANK
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By analyzing existing cross correlation between Nasdaq Inc and KEYBANK NATL ASSN, you can compare the effects of market volatilities on Nasdaq and KEYBANK 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 Nasdaq with a short position of KEYBANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and KEYBANK.
Diversification Opportunities for Nasdaq and KEYBANK
Modest diversification
The 3 months correlation between Nasdaq and KEYBANK is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and KEYBANK NATL ASSN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEYBANK NATL ASSN and Nasdaq 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 Nasdaq Inc are associated (or correlated) with KEYBANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEYBANK NATL ASSN has no effect on the direction of Nasdaq i.e., Nasdaq and KEYBANK go up and down completely randomly.
Pair Corralation between Nasdaq and KEYBANK
Given the investment horizon of 90 days Nasdaq Inc is expected to generate 0.67 times more return on investment than KEYBANK. However, Nasdaq Inc is 1.49 times less risky than KEYBANK. It trades about -0.06 of its potential returns per unit of risk. KEYBANK NATL ASSN is currently generating about -0.29 per unit of risk. If you would invest 8,119 in Nasdaq Inc on November 29, 2024 and sell it today you would lose (115.00) from holding Nasdaq Inc or give up 1.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 61.9% |
| Values | Daily Returns |
Nasdaq Inc vs. KEYBANK NATL ASSN
Performance |
| Timeline |
| Nasdaq Inc |
| KEYBANK NATL ASSN |
Nasdaq and KEYBANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq and KEYBANK
The main advantage of trading using opposite Nasdaq and KEYBANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq position performs unexpectedly, KEYBANK 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 KEYBANK will offset losses from the drop in KEYBANK's long position.The idea behind Nasdaq Inc and KEYBANK NATL ASSN 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.| KEYBANK vs. Tyson Foods | KEYBANK vs. Sapiens International | KEYBANK vs. Hurco Companies | KEYBANK vs. Emerson Electric |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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