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 2.23 times less risky than Crédit Agricole. The stock trades about -0.21 of its potential returns per unit of risk. The Crdit Agricole SA is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  1,392  in Crdit Agricole SA on September 10, 2024 and sell it today you would lose (33.00) from holding Crdit Agricole SA or give up 2.37% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

Other Complementary Tools

Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Earnings Calls
Check upcoming earnings announcements updated hourly across public exchanges
Share Portfolio
Track or share privately all of your investments from the convenience of any device