Correlation Between KeyCorp and LINKBANCORP

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

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

Diversification Opportunities for KeyCorp and LINKBANCORP

0.57

Correlation Coefficient

KeyCorp  LINKBANCORP

Very weak diversification

The 3 months correlation between KeyCorp and LINKBANCORP is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding KeyCorp and LINKBANCORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LINKBANCORP and KeyCorp 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 KeyCorp are associated (or correlated) with LINKBANCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LINKBANCORP has no effect on the direction of KeyCorp i.e., KeyCorp and LINKBANCORP go up and down completely randomly.

Pair Corralation between KeyCorp and LINKBANCORP

Assuming the 90 days trading horizon KeyCorp is expected to generate 9.99 times less return on investment than LINKBANCORP. But when comparing it to its historical volatility, KeyCorp is 4.07 times less risky than LINKBANCORP. It trades about 0.04 of its potential returns per unit of risk. LINKBANCORP is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  667.00  in LINKBANCORP on April 29, 2025 and sell it today you would earn a total of  67.00  from holding LINKBANCORP or generate 10.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

KeyCorp  vs.  LINKBANCORP

KeyCorp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in KeyCorp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, KeyCorp is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

LINKBANCORP

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in LINKBANCORP are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent forward-looking signals, LINKBANCORP may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with KeyCorp and LINKBANCORP

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

The idea behind KeyCorp and LINKBANCORP 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.