Correlation Between Affinity Bancshares and Apollo Bancorp
Can any of the company-specific risk be diversified away by investing in both Affinity Bancshares and Apollo Bancorp 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 Affinity Bancshares and Apollo Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affinity Bancshares and Apollo Bancorp, you can compare the effects of market volatilities on Affinity Bancshares and Apollo Bancorp 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 Affinity Bancshares with a short position of Apollo Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affinity Bancshares and Apollo Bancorp.
Diversification Opportunities for Affinity Bancshares and Apollo Bancorp
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Affinity and Apollo is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Affinity Bancshares and Apollo Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Bancorp and Affinity Bancshares 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 Affinity Bancshares are associated (or correlated) with Apollo Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Bancorp has no effect on the direction of Affinity Bancshares i.e., Affinity Bancshares and Apollo Bancorp go up and down completely randomly.
Pair Corralation between Affinity Bancshares and Apollo Bancorp
Given the investment horizon of 90 days Affinity Bancshares is expected to under-perform the Apollo Bancorp. In addition to that, Affinity Bancshares is 1.24 times more volatile than Apollo Bancorp. It trades about -0.03 of its total potential returns per unit of risk. Apollo Bancorp is currently generating about 0.1 per unit of volatility. If you would invest 3,588 in Apollo Bancorp on December 1, 2024 and sell it today you would earn a total of 412.00 from holding Apollo Bancorp or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.75% |
| Values | Daily Returns |
Affinity Bancshares vs. Apollo Bancorp
Performance |
| Timeline |
| Affinity Bancshares |
| Apollo Bancorp |
Affinity Bancshares and Apollo Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affinity Bancshares and Apollo Bancorp
The main advantage of trading using opposite Affinity Bancshares and Apollo Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affinity Bancshares position performs unexpectedly, Apollo Bancorp 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 Apollo Bancorp will offset losses from the drop in Apollo Bancorp's long position.| Affinity Bancshares vs. Home Federal Bancorp | Affinity Bancshares vs. Magyar Bancorp | Affinity Bancshares vs. Community West Bancshares |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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