Correlation Between 49327M3F9 and Arrow Financial

Can any of the company-specific risk be diversified away by investing in both 49327M3F9 and Arrow Financial 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 49327M3F9 and Arrow Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KEY 585 15 NOV 27 and Arrow Financial, you can compare the effects of market volatilities on 49327M3F9 and Arrow Financial 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 49327M3F9 with a short position of Arrow Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of 49327M3F9 and Arrow Financial.

Diversification Opportunities for 49327M3F9 and Arrow Financial

0.01

Correlation Coefficient

49327M3F9  Arrow Financial

Significant diversification

The 3 months correlation between 49327M3F9 and Arrow is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding KEY 585 15 NOV 27 and Arrow Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Financial and 49327M3F9 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 KEY 585 15 NOV 27 are associated (or correlated) with Arrow Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Financial has no effect on the direction of 49327M3F9 i.e., 49327M3F9 and Arrow Financial go up and down completely randomly.

Pair Corralation between 49327M3F9 and Arrow Financial

Assuming the 90 days trading horizon 49327M3F9 is expected to generate 21.86 times less return on investment than Arrow Financial. But when comparing it to its historical volatility, KEY 585 15 NOV 27 is 1.58 times less risky than Arrow Financial. It trades about 0.0 of its potential returns per unit of risk. Arrow Financial is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,555  in Arrow Financial on September 26, 2024 and sell it today you would earn a total of  327.00  from holding Arrow Financial or generate 12.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	90.4%
Values	Daily Returns

KEY 585 15 NOV 27  vs.  Arrow Financial

KEY 585 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KEY 585 15 NOV 27 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 49327M3F9 is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Arrow Financial

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Arrow Financial are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Arrow Financial is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with 49327M3F9 and Arrow Financial

The main advantage of trading using opposite 49327M3F9 and Arrow Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 49327M3F9 position performs unexpectedly, Arrow Financial 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 Arrow Financial will offset losses from the drop in Arrow Financial's long position.

The idea behind KEY 585 15 NOV 27 and Arrow Financial 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.