Correlation Between Mizuho Financial and BOK Financial

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

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

Diversification Opportunities for Mizuho Financial and BOK Financial

0.78

Correlation Coefficient

Mizuho Financial  BOK Financial

Poor diversification

The 3 months correlation between Mizuho and BOK is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Mizuho Financial Group and BOK Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOK Financial and Mizuho Financial 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 Mizuho Financial Group are associated (or correlated) with BOK Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOK Financial has no effect on the direction of Mizuho Financial i.e., Mizuho Financial and BOK Financial go up and down completely randomly.

Pair Corralation between Mizuho Financial and BOK Financial

Assuming the 90 days horizon Mizuho Financial Group is expected to generate 5.39 times more return on investment than BOK Financial. However, Mizuho Financial is 5.39 times more volatile than BOK Financial. It trades about 0.08 of its potential returns per unit of risk. BOK Financial is currently generating about 0.07 per unit of risk. If you would invest  2,240  in Mizuho Financial Group on September 17, 2024 and sell it today you would earn a total of  125.00  from holding Mizuho Financial Group or generate 5.58% return on investment over 90 days.

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

Mizuho Financial Group  vs.  BOK Financial

Mizuho Financial

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mizuho Financial Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent basic indicators, Mizuho Financial reported solid returns over the last few months and may actually be approaching a breakup point.

BOK Financial

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BOK Financial are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating forward-looking signals, BOK Financial may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Mizuho Financial and BOK Financial

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

The idea behind Mizuho Financial Group and BOK 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.