Correlation Between Republic Bancorp and GASBCM

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

By analyzing existing cross correlation between Republic Bancorp and GASBCM 6129 23 FEB 38, you can compare the effects of market volatilities on Republic Bancorp and GASBCM 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 Republic Bancorp with a short position of GASBCM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Republic Bancorp and GASBCM.

Diversification Opportunities for Republic Bancorp and GASBCM

0.26

Correlation Coefficient

Republic Bancorp  GASBCM

Modest diversification

The 3 months correlation between Republic and GASBCM is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Republic Bancorp and GASBCM 6129 23 FEB 38 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GASBCM 6129 23 and Republic 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 Republic Bancorp are associated (or correlated) with GASBCM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GASBCM 6129 23 has no effect on the direction of Republic Bancorp i.e., Republic Bancorp and GASBCM go up and down completely randomly.

Pair Corralation between Republic Bancorp and GASBCM

Assuming the 90 days horizon Republic Bancorp is expected to under-perform the GASBCM. But the stock apears to be less risky and, when comparing its historical volatility, Republic Bancorp is 1.47 times less risky than GASBCM. The stock trades about -0.45 of its potential returns per unit of risk. The GASBCM 6129 23 FEB 38 is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  10,216  in GASBCM 6129 23 FEB 38 on October 13, 2024 and sell it today you would lose (26.00) from holding GASBCM 6129 23 FEB 38 or give up 0.25% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	20.0%
Values	Daily Returns

Republic Bancorp  vs.  GASBCM 6129 23 FEB 38

Republic Bancorp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Republic Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Republic Bancorp is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

GASBCM 6129 23

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GASBCM 6129 23 FEB 38 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak 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 GASBCM 6129 23 FEB 38 investors.

Pair Trading with Republic Bancorp and GASBCM

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

The idea behind Republic Bancorp and GASBCM 6129 23 FEB 38 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.