Correlation Between TrustCo Bank and Alpine Banks
Can any of the company-specific risk be diversified away by investing in both TrustCo Bank and Alpine Banks 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 TrustCo Bank and Alpine Banks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TrustCo Bank Corp and Alpine Banks of, you can compare the effects of market volatilities on TrustCo Bank and Alpine Banks 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 TrustCo Bank with a short position of Alpine Banks. Check out your portfolio center. Please also check ongoing floating volatility patterns of TrustCo Bank and Alpine Banks.
Diversification Opportunities for TrustCo Bank and Alpine Banks
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TrustCo and Alpine is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding TrustCo Bank Corp and Alpine Banks of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpine Banks and TrustCo Bank 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 TrustCo Bank Corp are associated (or correlated) with Alpine Banks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpine Banks has no effect on the direction of TrustCo Bank i.e., TrustCo Bank and Alpine Banks go up and down completely randomly.
Pair Corralation between TrustCo Bank and Alpine Banks
Given the investment horizon of 90 days TrustCo Bank Corp is expected to generate 2.18 times more return on investment than Alpine Banks. However, TrustCo Bank is 2.18 times more volatile than Alpine Banks of. It trades about 0.08 of its potential returns per unit of risk. Alpine Banks of is currently generating about 0.12 per unit of risk. If you would invest 2,604 in TrustCo Bank Corp on September 14, 2024 and sell it today you would earn a total of 1,064 from holding TrustCo Bank Corp or generate 40.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.63% |
| Values | Daily Returns |
TrustCo Bank Corp vs. Alpine Banks of
Performance |
| Timeline |
| TrustCo Bank Corp |
| Alpine Banks |
TrustCo Bank and Alpine Banks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TrustCo Bank and Alpine Banks
The main advantage of trading using opposite TrustCo Bank and Alpine Banks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TrustCo Bank position performs unexpectedly, Alpine Banks 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 Alpine Banks will offset losses from the drop in Alpine Banks' long position.| TrustCo Bank vs. Southern Missouri Bancorp | TrustCo Bank vs. IF Bancorp | TrustCo Bank vs. Colony Bankcorp | TrustCo Bank vs. Old Point 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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