Correlation Between Invesco Advantage and Kish Bancorp

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

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

Diversification Opportunities for Invesco Advantage and Kish Bancorp

-0.42

Correlation Coefficient

Invesco Advantage  Kish Bancorp

Very good diversification

The 3 months correlation between Invesco and Kish is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Advantage MIT and Kish Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kish Bancorp and Invesco Advantage 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 Invesco Advantage MIT are associated (or correlated) with Kish Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kish Bancorp has no effect on the direction of Invesco Advantage i.e., Invesco Advantage and Kish Bancorp go up and down completely randomly.

Pair Corralation between Invesco Advantage and Kish Bancorp

Considering the 90-day investment horizon Invesco Advantage is expected to generate 2.35 times less return on investment than Kish Bancorp. But when comparing it to its historical volatility, Invesco Advantage MIT is 2.55 times less risky than Kish Bancorp. It trades about 0.1 of its potential returns per unit of risk. Kish Bancorp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,976  in Kish Bancorp on September 5, 2024 and sell it today you would earn a total of  224.00  from holding Kish Bancorp or generate 7.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Invesco Advantage MIT  vs.  Kish Bancorp

Invesco Advantage MIT

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco Advantage MIT are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward-looking signals, Invesco Advantage is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Kish Bancorp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kish Bancorp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Kish Bancorp may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Invesco Advantage and Kish Bancorp

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

The idea behind Invesco Advantage MIT and Kish Bancorp 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.