Correlation Between Alphabet and Bancfirst Corp

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Can any of the company-specific risk be diversified away by investing in both Alphabet and Bancfirst Corp 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 Alphabet and Bancfirst Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphabet Cl A and Bancfirst Corp, you can compare the effects of market volatilities on Alphabet and Bancfirst Corp 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 Alphabet with a short position of Bancfirst Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and Bancfirst Corp.

Diversification Opportunities for Alphabet and Bancfirst Corp

  Correlation Coefficient

Poor diversification

The 3 months correlation between Alphabet and Bancfirst is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Cl A and Bancfirst Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bancfirst Corp and Alphabet 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 Alphabet Cl A are associated (or correlated) with Bancfirst Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bancfirst Corp has no effect on the direction of Alphabet i.e., Alphabet and Bancfirst Corp go up and down completely randomly.

Pair Corralation between Alphabet and Bancfirst Corp

Assuming the 90 days horizon Alphabet is expected to generate 3.25 times less return on investment than Bancfirst Corp. In addition to that, Alphabet is 1.01 times more volatile than Bancfirst Corp. It trades about 0.02 of its total potential returns per unit of risk. Bancfirst Corp is currently generating about 0.07 per unit of volatility. If you would invest  5,406  in Bancfirst Corp on July 3, 2022 and sell it today you would earn a total of  3,541  from holding Bancfirst Corp or generate 65.5% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
ValuesDaily Returns

Alphabet Cl A  vs.  Bancfirst Corp

 Performance (%) 
Alphabet Cl A 
Alphabet Performance
0 of 100
Over the last 90 days Alphabet Cl A has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's technical and fundamental indicators remain relatively steady which may send shares a bit higher in November 2022. The new chaos may also be a sign of medium-term up-swing for the company stakeholders.

Alphabet Price Channel

Bancfirst Corp 
Bancfirst Performance
0 of 100
Over the last 90 days Bancfirst Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Bancfirst Price Channel

Alphabet and Bancfirst Corp Volatility Contrast

   Predicted Return Density   

Pair Trading with Alphabet and Bancfirst Corp

The main advantage of trading using opposite Alphabet and Bancfirst Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphabet position performs unexpectedly, Bancfirst Corp 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 Bancfirst Corp will offset losses from the drop in Bancfirst Corp's long position.
Alphabet vs. Tencent Holdings
The idea behind Alphabet Cl A and Bancfirst Corp 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.
Bancfirst Corp vs. Amazon Inc
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.

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