Correlation Between ConnectOne Bancorp and 191216CP3

Can any of the company-specific risk be diversified away by investing in both ConnectOne Bancorp and 191216CP3 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 ConnectOne Bancorp and 191216CP3 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ConnectOne Bancorp and KO 4125 25 MAR 40, you can compare the effects of market volatilities on ConnectOne Bancorp and 191216CP3 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 ConnectOne Bancorp with a short position of 191216CP3. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConnectOne Bancorp and 191216CP3.

Diversification Opportunities for ConnectOne Bancorp and 191216CP3

-0.49

Correlation Coefficient

ConnectOne Bancorp  191216CP3

Very good diversification

The 3 months correlation between ConnectOne and 191216CP3 is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding ConnectOne Bancorp and KO 4125 25 MAR 40 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KO 4125 25 and ConnectOne Bancorp 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 ConnectOne Bancorp are associated (or correlated) with 191216CP3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KO 4125 25 has no effect on the direction of ConnectOne Bancorp i.e., ConnectOne Bancorp and 191216CP3 go up and down completely randomly.

Pair Corralation between ConnectOne Bancorp and 191216CP3

Assuming the 90 days horizon ConnectOne Bancorp is expected to generate 0.73 times more return on investment than 191216CP3. However, ConnectOne Bancorp is 1.37 times less risky than 191216CP3. It trades about 0.08 of its potential returns per unit of risk. KO 4125 25 MAR 40 is currently generating about -0.11 per unit of risk. If you would invest  2,123  in ConnectOne Bancorp on September 24, 2024 and sell it today you would earn a total of  103.00  from holding ConnectOne Bancorp or generate 4.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	60.94%
Values	Daily Returns

ConnectOne Bancorp  vs.  KO 4125 25 MAR 40

ConnectOne Bancorp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ConnectOne Bancorp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental drivers, ConnectOne Bancorp is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

KO 4125 25

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KO 4125 25 MAR 40 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for KO 4125 25 MAR 40 investors.

Pair Trading with ConnectOne Bancorp and 191216CP3

The main advantage of trading using opposite ConnectOne Bancorp and 191216CP3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConnectOne Bancorp position performs unexpectedly, 191216CP3 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 191216CP3 will offset losses from the drop in 191216CP3's long position.

The idea behind ConnectOne Bancorp and KO 4125 25 MAR 40 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.