Correlation Between 970648AK7 and BCB Bancorp

Can any of the company-specific risk be diversified away by investing in both 970648AK7 and BCB 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 970648AK7 and BCB Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between WTW 3875 15 SEP 49 and BCB Bancorp, you can compare the effects of market volatilities on 970648AK7 and BCB 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 970648AK7 with a short position of BCB Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of 970648AK7 and BCB Bancorp.

Diversification Opportunities for 970648AK7 and BCB Bancorp

-0.3

Correlation Coefficient

970648AK7  BCB Bancorp

Very good diversification

The 3 months correlation between 970648AK7 and BCB is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding WTW 3875 15 SEP 49 and BCB Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCB Bancorp and 970648AK7 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 WTW 3875 15 SEP 49 are associated (or correlated) with BCB Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCB Bancorp has no effect on the direction of 970648AK7 i.e., 970648AK7 and BCB Bancorp go up and down completely randomly.

Pair Corralation between 970648AK7 and BCB Bancorp

Assuming the 90 days trading horizon WTW 3875 15 SEP 49 is expected to under-perform the BCB Bancorp. But the bond apears to be less risky and, when comparing its historical volatility, WTW 3875 15 SEP 49 is 2.02 times less risky than BCB Bancorp. The bond trades about -0.11 of its potential returns per unit of risk. The BCB Bancorp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,182  in BCB Bancorp on September 12, 2024 and sell it today you would earn a total of  97.00  from holding BCB Bancorp or generate 8.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	71.43%
Values	Daily Returns

WTW 3875 15 SEP 49  vs.  BCB Bancorp

WTW 3875 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WTW 3875 15 SEP 49 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for WTW 3875 15 SEP 49 investors.

BCB Bancorp

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BCB Bancorp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating fundamental drivers, BCB Bancorp may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with 970648AK7 and BCB Bancorp

The main advantage of trading using opposite 970648AK7 and BCB Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 970648AK7 position performs unexpectedly, BCB 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 BCB Bancorp will offset losses from the drop in BCB Bancorp's long position.

The idea behind WTW 3875 15 SEP 49 and BCB 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.