Correlation Between Allhome Corp and Bank of the

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

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

Diversification Opportunities for Allhome Corp and Bank of the

-0.68

Correlation Coefficient

Allhome Corp  Bank of the

Excellent diversification

The 3 months correlation between Allhome and Bank is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Allhome Corp and Bank of the in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of the and Allhome Corp 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 Allhome Corp are associated (or correlated) with Bank of the. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of the has no effect on the direction of Allhome Corp i.e., Allhome Corp and Bank of the go up and down completely randomly.

Pair Corralation between Allhome Corp and Bank of the

Assuming the 90 days trading horizon Allhome Corp is expected to under-perform the Bank of the. In addition to that, Allhome Corp is 1.17 times more volatile than Bank of the. It trades about -0.12 of its total potential returns per unit of risk. Bank of the is currently generating about 0.1 per unit of volatility. If you would invest  12,200  in Bank of the on December 30, 2024 and sell it today you would earn a total of  1,260  from holding Bank of the or generate 10.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Allhome Corp  vs.  Bank of the

Allhome Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allhome Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Bank of the

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bank of the are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Bank of the may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Allhome Corp and Bank of the

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

The idea behind Allhome Corp and Bank of the 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.