Correlation Between Bank of New York and VODAFONE

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Can any of the company-specific risk be diversified away by investing in both Bank of New York and VODAFONE 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 of New York and VODAFONE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Bank of and VODAFONE GROUP PLC, you can compare the effects of market volatilities on Bank of New York and VODAFONE 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 of New York with a short position of VODAFONE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of New York and VODAFONE.

Diversification Opportunities for Bank of New York and VODAFONE

-0.1
  Correlation Coefficient

Good diversification

The 3 months correlation between Bank and VODAFONE is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding The Bank of and VODAFONE GROUP PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VODAFONE GROUP PLC and Bank of New York 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 The Bank of are associated (or correlated) with VODAFONE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VODAFONE GROUP PLC has no effect on the direction of Bank of New York i.e., Bank of New York and VODAFONE go up and down completely randomly.

Pair Corralation between Bank of New York and VODAFONE

Allowing for the 90-day total investment horizon The Bank of is expected to generate 2.74 times more return on investment than VODAFONE. However, Bank of New York is 2.74 times more volatile than VODAFONE GROUP PLC. It trades about 0.14 of its potential returns per unit of risk. VODAFONE GROUP PLC is currently generating about -0.03 per unit of risk. If you would invest  10,124  in The Bank of on August 17, 2025 and sell it today you would earn a total of  924.00  from holding The Bank of or generate 9.13% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy79.69%
ValuesDaily Returns

The Bank of  vs.  VODAFONE GROUP PLC

 Performance 
       Timeline  
Bank of New York 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in The Bank of are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain forward-looking signals, Bank of New York may actually be approaching a critical reversion point that can send shares even higher in December 2025.
VODAFONE GROUP PLC 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days VODAFONE GROUP PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, VODAFONE is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Bank of New York and VODAFONE Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bank of New York and VODAFONE

The main advantage of trading using opposite Bank of New York and VODAFONE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of New York position performs unexpectedly, VODAFONE 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 VODAFONE will offset losses from the drop in VODAFONE's long position.
The idea behind The Bank of and VODAFONE GROUP PLC 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.
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.

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