Correlation Between Bar Harbor and Banco De
Can any of the company-specific risk be diversified away by investing in both Bar Harbor and Banco De 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 Bar Harbor and Banco De into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bar Harbor Bankshares and Banco De Chile, you can compare the effects of market volatilities on Bar Harbor and Banco De 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 Bar Harbor with a short position of Banco De. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bar Harbor and Banco De.
Diversification Opportunities for Bar Harbor and Banco De
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bar and Banco is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Bar Harbor Bankshares and Banco De Chile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco De Chile and Bar Harbor 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 Bar Harbor Bankshares are associated (or correlated) with Banco De. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco De Chile has no effect on the direction of Bar Harbor i.e., Bar Harbor and Banco De go up and down completely randomly.
Pair Corralation between Bar Harbor and Banco De
Considering the 90-day investment horizon Bar Harbor Bankshares is expected to generate 1.82 times more return on investment than Banco De. However, Bar Harbor is 1.82 times more volatile than Banco De Chile. It trades about 0.07 of its potential returns per unit of risk. Banco De Chile is currently generating about 0.07 per unit of risk. If you would invest 2,500 in Bar Harbor Bankshares on January 26, 2024 and sell it today you would earn a total of 75.00 from holding Bar Harbor Bankshares or generate 3.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Bar Harbor Bankshares vs. Banco De Chile
Performance |
Timeline |
Bar Harbor Bankshares |
Banco De Chile |
Bar Harbor and Banco De Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bar Harbor and Banco De
The main advantage of trading using opposite Bar Harbor and Banco De positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bar Harbor position performs unexpectedly, Banco De 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 Banco De will offset losses from the drop in Banco De's long position.Bar Harbor vs. Camden National | Bar Harbor vs. Bank of Marin | Bar Harbor vs. Arrow Financial | Bar Harbor vs. Auburn National Bancorporation |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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