Correlation Between CARGOJET INC and KeyCorp

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

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

Diversification Opportunities for CARGOJET INC and KeyCorp

0.89

Correlation Coefficient

CARGOJET INC  KeyCorp

Very poor diversification

The 3 months correlation between CARGOJET and KeyCorp is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding CARGOJET INC VAR and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp and CARGOJET INC 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 CARGOJET INC VAR are associated (or correlated) with KeyCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KeyCorp has no effect on the direction of CARGOJET INC i.e., CARGOJET INC and KeyCorp go up and down completely randomly.

Pair Corralation between CARGOJET INC and KeyCorp

Assuming the 90 days trading horizon CARGOJET INC is expected to generate 1.25 times less return on investment than KeyCorp. In addition to that, CARGOJET INC is 1.53 times more volatile than KeyCorp. It trades about 0.12 of its total potential returns per unit of risk. KeyCorp is currently generating about 0.22 per unit of volatility. If you would invest  1,249  in KeyCorp on April 24, 2025 and sell it today you would earn a total of  300.00  from holding KeyCorp or generate 24.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.44%
Values	Daily Returns

CARGOJET INC VAR  vs.  KeyCorp

CARGOJET INC VAR

Risk-Adjusted Performance

OK

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

KeyCorp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in KeyCorp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, KeyCorp reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CARGOJET INC and KeyCorp

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

The idea behind CARGOJET INC VAR and KeyCorp 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.