Correlation Between BRP and Signature Bank
Can any of the company-specific risk be diversified away by investing in both BRP and Signature Bank 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 BRP and Signature Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRP Inc and Signature Bank, you can compare the effects of market volatilities on BRP and Signature Bank 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 BRP with a short position of Signature Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRP and Signature Bank.
Diversification Opportunities for BRP and Signature Bank
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BRP and Signature is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding BRP Inc and Signature Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Signature Bank and BRP 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 BRP Inc are associated (or correlated) with Signature Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Signature Bank has no effect on the direction of BRP i.e., BRP and Signature Bank go up and down completely randomly.
Pair Corralation between BRP and Signature Bank
If you would invest 5,084 in BRP Inc on September 24, 2024 and sell it today you would earn a total of 175.00 from holding BRP Inc or generate 3.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 5.0% |
Values | Daily Returns |
BRP Inc vs. Signature Bank
Performance |
Timeline |
BRP Inc |
Signature Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
BRP and Signature Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BRP and Signature Bank
The main advantage of trading using opposite BRP and Signature Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRP position performs unexpectedly, Signature Bank 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 Signature Bank will offset losses from the drop in Signature Bank's long position.BRP vs. Amer Sports, | BRP vs. Ralph Lauren Corp | BRP vs. Under Armour C | BRP vs. Dogness International Corp |
Signature Bank vs. BorgWarner | Signature Bank vs. BRP Inc | Signature Bank vs. Li Auto | Signature Bank vs. Pool Corporation |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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