Bank of Montreal Correlations

BMO Stock

USD 89.21 6.84 7.12%

The current 90-days correlation between Bank of Montreal and Canadian Imperial Bank is 0.54 (i.e., Very weak diversification). A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Bank of Montreal moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Bank of Montreal moves in either direction, the perfectly negatively correlated security will move in the opposite direction.

Bank of Montreal Correlation With Market

Poor diversification

The correlation between Bank of Montreal and DJI is 0.71 (i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Montreal and DJI in the same portfolio, assuming nothing else is changed.

Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Bank of Montreal. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in population.

To learn how to invest in Bank Stock, please use our How to Invest in Bank of Montreal guide.

Moving together with Bank Stock

0.77	C	Citigroup Earnings Call This Week	Pair Corr
0.8	BK	Bank of New York	Pair Corr
0.85	BML-PG	Bank of America	Pair Corr
0.87	BML-PH	Bank of America	Pair Corr
0.73	JPM	JPMorgan Chase Earnings Call This Week	Pair Corr
0.67	JPM-PK	JPMorgan Chase Earnings Call This Week	Pair Corr
0.66	JPM-PJ	JPMorgan Chase Earnings Call This Week	Pair Corr
0.62	JPM-PL	JPMorgan Chase Earnings Call This Week	Pair Corr
0.68	UBS	UBS Group AG	Pair Corr
0.77	WFC	Wells Fargo Earnings Call This Week	Pair Corr
0.66	BAC-PB	Bank of America	Pair Corr
0.71	BAC-PE	Bank of America	Pair Corr
0.64	BAC-PM	Bank of America	Pair Corr
0.72	BAC-PL	Bank of America	Pair Corr
0.62	BAC-PQ	Bank of America	Pair Corr
0.67	BAC-PO	Bank of America	Pair Corr
0.62	BAC-PP	Bank of America	Pair Corr
0.64	BAC-PS	Bank of America	Pair Corr

Related Correlations Analysis

	CM	TD	RY	C	BNS	BAC	JPM	WFC
CM		-0.55	0.94	0.64	0.96	0.8	0.61	0.54	CM
TD	-0.55		-0.39	0.12	-0.66	-0.31	0.18	0.2	TD
RY	0.94	-0.39		0.74	0.89	0.84	0.71	0.66	RY
C	0.64	0.12	0.74		0.53	0.87	0.97	0.97	C
BNS	0.96	-0.66	0.89	0.53		0.75	0.48	0.43	BNS
BAC	0.8	-0.31	0.84	0.87	0.75		0.83	0.83	BAC
JPM	0.61	0.18	0.71	0.97	0.48	0.83		0.97	JPM
WFC	0.54	0.2	0.66	0.97	0.43	0.83	0.97		WFC
	CM	TD	RY	C	BNS	BAC	JPM	WFC

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

JPM	+ 0.97	C
WFC	+ 0.97	C
WFC	+ 0.97	JPM
BNS	+ 0.96	CM
RY	+ 0.94	CM
BNS	+ 0.89	RY

High negative correlations

BNS	- 0.66	TD
TD	- 0.55	CM
RY	- 0.39	TD
BAC	- 0.31	TD

Risk-Adjusted Indicators

There is a big difference between Bank Stock performing well and Bank of Montreal Company doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Bank of Montreal's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Semi Deviation	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
CM	0.98	(0.06)	0.00	(0.26)	0.00	0.00	1.80	(2.37)	6.73
TD	0.77	0.19	0.36	1.73	0.67	(0.83)	1.68	(1.34)	5.80
RY	1.01	0.02	0.00	(0.14)	0.00	0.00	2.03	(2.67)	6.21
C	1.75	0.04	0.00	(0.14)	0.00	0.00	2.86	(4.33)	18.63
BNS	0.80	(0.11)	0.00	(0.47)	0.00	0.00	1.57	(1.77)	5.15
BAC	1.43	(0.09)	0.00	(0.22)	0.00	0.00	1.59	(3.79)	15.56
JPM	1.34	0.06	0.00	(0.12)	0.00	0.00	2.16	(4.15)	10.19
WFC	1.46	0.06	0.00	(0.12)	0.00	0.00	2.43	(4.84)	15.81

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