Correlation Between Bank Central and Algonquin Power
Can any of the company-specific risk be diversified away by investing in both Bank Central and Algonquin Power 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 Bank Central and Algonquin Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Central Asia and Algonquin Power Utilities, you can compare the effects of market volatilities on Bank Central and Algonquin Power 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 Bank Central with a short position of Algonquin Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Central and Algonquin Power.
Diversification Opportunities for Bank Central and Algonquin Power
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Algonquin is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Bank Central Asia and Algonquin Power Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algonquin Power Utilities and Bank Central 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 Bank Central Asia are associated (or correlated) with Algonquin Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algonquin Power Utilities has no effect on the direction of Bank Central i.e., Bank Central and Algonquin Power go up and down completely randomly.
Pair Corralation between Bank Central and Algonquin Power
If you would invest 1,369 in Bank Central Asia on September 4, 2024 and sell it today you would earn a total of 212.00 from holding Bank Central Asia or generate 15.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.41% |
| Values | Daily Returns |
Bank Central Asia vs. Algonquin Power Utilities
Performance |
| Timeline |
| Bank Central Asia |
| Algonquin Power Utilities |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bank Central and Algonquin Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Central and Algonquin Power
The main advantage of trading using opposite Bank Central and Algonquin Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Central position performs unexpectedly, Algonquin Power 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 Algonquin Power will offset losses from the drop in Algonquin Power's long position.| Bank Central vs. First Hawaiian | Bank Central vs. Central Pacific Financial | Bank Central vs. Territorial Bancorp | Bank Central vs. Comerica |
| Algonquin Power vs. Algonquin Power Utilities | Algonquin Power vs. CMS Energy Corp | Algonquin Power vs. CMS Energy Corp | Algonquin Power vs. Argo Group 65 |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |