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

0.63

Correlation Coefficient

KeyCorp  LINKBANCORP

Poor diversification

The 3 months correlation between KeyCorp and LINKBANCORP is 0.63. 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 0.41 times more return on investment than LINKBANCORP. However, KeyCorp is 2.44 times less risky than LINKBANCORP. It trades about 0.05 of its potential returns per unit of risk. LINKBANCORP is currently generating about 0.02 per unit of risk. If you would invest  2,157  in KeyCorp on May 2, 2025 and sell it today you would earn a total of  54.00  from holding KeyCorp or generate 2.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
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 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively steady basic indicators, KeyCorp is not utilizing all of its potentials. The recent stock price chaos, may contribute to medium-term losses for the stakeholders.

LINKBANCORP

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in LINKBANCORP are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong forward-looking signals, LINKBANCORP is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

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.

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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.