Correlation Between Bank of Utica and Bank Utica

Can any of the company-specific risk be diversified away by investing in both Bank of Utica and Bank Utica 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 Utica and Bank Utica into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bank of Utica and Bank Utica Ny, you can compare the effects of market volatilities on Bank of Utica and Bank Utica 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 Utica with a short position of Bank Utica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Utica and Bank Utica.

Diversification Opportunities for Bank of Utica and Bank Utica

0.23

Correlation Coefficient

Bank of Utica  Bank Utica

Modest diversification

The 3 months correlation between Bank and Bank is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Utica and Bank Utica Ny in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Utica Ny and Bank of Utica 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 Utica are associated (or correlated) with Bank Utica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Utica Ny has no effect on the direction of Bank of Utica i.e., Bank of Utica and Bank Utica go up and down completely randomly.

Pair Corralation between Bank of Utica and Bank Utica

Given the investment horizon of 90 days Bank of Utica is expected to generate 1.2 times less return on investment than Bank Utica. In addition to that, Bank of Utica is 1.67 times more volatile than Bank Utica Ny. It trades about 0.04 of its total potential returns per unit of risk. Bank Utica Ny is currently generating about 0.07 per unit of volatility. If you would invest  32,951  in Bank Utica Ny on December 3, 2024 and sell it today you would earn a total of  11,162  from holding Bank Utica Ny or generate 33.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	51.15%
Values	Daily Returns

Bank of Utica  vs.  Bank Utica Ny

Bank of Utica

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bank of Utica has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Bank Utica Ny

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bank Utica Ny has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Bank of Utica and Bank Utica

The main advantage of trading using opposite Bank of Utica and Bank Utica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Utica position performs unexpectedly, Bank Utica 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 Bank Utica will offset losses from the drop in Bank Utica's long position.

The idea behind Bank of Utica and Bank Utica Ny 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.