Correlation Between Bank of the and Concepcion Industrial
Can any of the company-specific risk be diversified away by investing in both Bank of the and Concepcion Industrial 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 the and Concepcion Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of the and Concepcion Industrial Corp, you can compare the effects of market volatilities on Bank of the and Concepcion Industrial 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 the with a short position of Concepcion Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of the and Concepcion Industrial.
Diversification Opportunities for Bank of the and Concepcion Industrial
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Concepcion is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Bank of the and Concepcion Industrial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concepcion Industrial and Bank of the 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 of the are associated (or correlated) with Concepcion Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concepcion Industrial has no effect on the direction of Bank of the i.e., Bank of the and Concepcion Industrial go up and down completely randomly.
Pair Corralation between Bank of the and Concepcion Industrial
Assuming the 90 days trading horizon Bank of the is expected to under-perform the Concepcion Industrial. In addition to that, Bank of the is 1.17 times more volatile than Concepcion Industrial Corp. It trades about -0.21 of its total potential returns per unit of risk. Concepcion Industrial Corp is currently generating about -0.16 per unit of volatility. If you would invest 1,520 in Concepcion Industrial Corp on June 9, 2025 and sell it today you would lose (214.00) from holding Concepcion Industrial Corp or give up 14.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of the vs. Concepcion Industrial Corp
Performance |
| Timeline |
| Bank of the |
| Concepcion Industrial |
Bank of the and Concepcion Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of the and Concepcion Industrial
The main advantage of trading using opposite Bank of the and Concepcion Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of the position performs unexpectedly, Concepcion Industrial 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 Concepcion Industrial will offset losses from the drop in Concepcion Industrial's long position.| Bank of the vs. Rizal Commercial Banking | Bank of the vs. Atlas Consolidated Mining | Bank of the vs. Dizon Copper Silver | Bank of the vs. Marcventures Holdings |
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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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