Correlation Between KeyCorp and NFT

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

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

Diversification Opportunities for KeyCorp and NFT

0.45

Correlation Coefficient

KeyCorp  NFT

Very weak diversification

The 3 months correlation between KeyCorp and NFT is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding KeyCorp and NFT Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NFT Limited and KeyCorp 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 KeyCorp are associated (or correlated) with NFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NFT Limited has no effect on the direction of KeyCorp i.e., KeyCorp and NFT go up and down completely randomly.

Pair Corralation between KeyCorp and NFT

Assuming the 90 days trading horizon KeyCorp is expected to under-perform the NFT. But the preferred stock apears to be less risky and, when comparing its historical volatility, KeyCorp is 14.61 times less risky than NFT. The preferred stock trades about -0.06 of its potential returns per unit of risk. The NFT Limited is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  750.00  in NFT Limited on September 14, 2024 and sell it today you would lose (300.00) from holding NFT Limited or give up 40.0% of portfolio value over 90 days.

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

KeyCorp  vs.  NFT Limited

KeyCorp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KeyCorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, KeyCorp is not utilizing all of its potentials. The new stock price confusion, may contribute to short-horizon losses for the traders.

NFT Limited

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NFT Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, NFT may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with KeyCorp and NFT

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

The idea behind KeyCorp and NFT Limited 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.