Correlation Between Territorial Bancorp and Crédit Agricole

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Territorial Bancorp and Crédit Agricole 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 Territorial Bancorp and Crédit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Territorial Bancorp and Crdit Agricole SA, you can compare the effects of market volatilities on Territorial Bancorp and Crédit Agricole 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 Territorial Bancorp with a short position of Crédit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of Territorial Bancorp and Crédit Agricole.

Diversification Opportunities for Territorial Bancorp and Crédit Agricole

-0.56
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Territorial and Crédit is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Territorial Bancorp and Crdit Agricole SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crdit Agricole SA and Territorial 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 Territorial Bancorp are associated (or correlated) with Crédit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crdit Agricole SA has no effect on the direction of Territorial Bancorp i.e., Territorial Bancorp and Crédit Agricole go up and down completely randomly.

Pair Corralation between Territorial Bancorp and Crédit Agricole

Given the investment horizon of 90 days Territorial Bancorp is expected to under-perform the Crédit Agricole. But the stock apears to be less risky and, when comparing its historical volatility, Territorial Bancorp is 1.21 times less risky than Crédit Agricole. The stock trades about -0.03 of its potential returns per unit of risk. The Crdit Agricole SA is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  962.00  in Crdit Agricole SA on September 7, 2024 and sell it today you would earn a total of  397.00  from holding Crdit Agricole SA or generate 41.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy93.29%
ValuesDaily Returns

Territorial Bancorp  vs.  Crdit Agricole SA

 Performance 
       Timeline  
Territorial Bancorp 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Territorial Bancorp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Territorial Bancorp disclosed solid returns over the last few months and may actually be approaching a breakup point.
Crdit Agricole SA 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Crdit Agricole SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Territorial Bancorp and Crédit Agricole Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Territorial Bancorp and Crédit Agricole

The main advantage of trading using opposite Territorial Bancorp and Crédit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Territorial Bancorp position performs unexpectedly, Crédit Agricole 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 Crédit Agricole will offset losses from the drop in Crédit Agricole's long position.
The idea behind Territorial Bancorp and Crdit Agricole SA 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.
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.

Other Complementary Tools

Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Share Portfolio
Track or share privately all of your investments from the convenience of any device
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities