Correlation Between Industrial Commercial and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Industrial Commercial and Credit Suisse 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 Industrial Commercial and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Industrial Commercial Bank and Credit Suisse Group, you can compare the effects of market volatilities on Industrial Commercial and Credit Suisse 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 Industrial Commercial with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Commercial and Credit Suisse.
Diversification Opportunities for Industrial Commercial and Credit Suisse
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Industrial and Credit is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Commercial Bank and Credit Suisse Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Group and Industrial Commercial 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 Industrial Commercial Bank are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Group has no effect on the direction of Industrial Commercial i.e., Industrial Commercial and Credit Suisse go up and down completely randomly.
Pair Corralation between Industrial Commercial and Credit Suisse
If you would invest 1,062 in Industrial Commercial Bank on September 6, 2024 and sell it today you would earn a total of 144.00 from holding Industrial Commercial Bank or generate 13.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 1.56% |
Values | Daily Returns |
Industrial Commercial Bank vs. Credit Suisse Group
Performance |
Timeline |
Industrial Commercial |
Credit Suisse Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Industrial Commercial and Credit Suisse Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Industrial Commercial and Credit Suisse
The main advantage of trading using opposite Industrial Commercial and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Commercial position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.Industrial Commercial vs. Bank of China | Industrial Commercial vs. China Construction Bank | Industrial Commercial vs. Bank of America | Industrial Commercial vs. ANZ Group Holdings |
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Check out your portfolio center.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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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