Correlation Between NYSE Composite and Bank of Hawaii
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Bank of Hawaii 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 NYSE Composite and Bank of Hawaii into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Bank of Hawaii, you can compare the effects of market volatilities on NYSE Composite and Bank of Hawaii 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 NYSE Composite with a short position of Bank of Hawaii. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Bank of Hawaii.
Diversification Opportunities for NYSE Composite and Bank of Hawaii
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NYSE and Bank is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Bank of Hawaii in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Hawaii and NYSE Composite 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 NYSE Composite are associated (or correlated) with Bank of Hawaii. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Hawaii has no effect on the direction of NYSE Composite i.e., NYSE Composite and Bank of Hawaii go up and down completely randomly.
Pair Corralation between NYSE Composite and Bank of Hawaii
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.59 times more return on investment than Bank of Hawaii. However, NYSE Composite is 1.69 times less risky than Bank of Hawaii. It trades about 0.14 of its potential returns per unit of risk. Bank of Hawaii is currently generating about 0.05 per unit of risk. If you would invest 1,800,696 in NYSE Composite on September 1, 2024 and sell it today you would earn a total of 226,508 from holding NYSE Composite or generate 12.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Bank of Hawaii
Performance |
| Timeline |
NYSE Composite and Bank of Hawaii Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Bank of Hawaii
Pair trading matchups for Bank of Hawaii
Pair Trading with NYSE Composite and Bank of Hawaii
The main advantage of trading using opposite NYSE Composite and Bank of Hawaii positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Bank of Hawaii 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 Bank of Hawaii will offset losses from the drop in Bank of Hawaii's long position.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| Bank of Hawaii vs. Fifth Third Bancorp | Bank of Hawaii vs. Fifth Third Bancorp | Bank of Hawaii vs. First Citizens BancShares | Bank of Hawaii vs. Huntington Bancshares Incorporated |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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