Correlation Between Affinity Bancshares and Civista Bancshares
Can any of the company-specific risk be diversified away by investing in both Affinity Bancshares and Civista Bancshares 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 Civista Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affinity Bancshares and Civista Bancshares, you can compare the effects of market volatilities on Affinity Bancshares and Civista Bancshares 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 Civista Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affinity Bancshares and Civista Bancshares.
Diversification Opportunities for Affinity Bancshares and Civista Bancshares
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Affinity and Civista is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Affinity Bancshares and Civista Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Civista Bancshares 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 Civista Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Civista Bancshares has no effect on the direction of Affinity Bancshares i.e., Affinity Bancshares and Civista Bancshares go up and down completely randomly.
Pair Corralation between Affinity Bancshares and Civista Bancshares
Given the investment horizon of 90 days Affinity Bancshares is expected to generate 0.46 times more return on investment than Civista Bancshares. However, Affinity Bancshares is 2.18 times less risky than Civista Bancshares. It trades about 0.01 of its potential returns per unit of risk. Civista Bancshares is currently generating about -0.08 per unit of risk. If you would invest 1,747 in Affinity Bancshares on January 13, 2025 and sell it today you would earn a total of 3.00 from holding Affinity Bancshares or generate 0.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Affinity Bancshares vs. Civista Bancshares
Performance |
| Timeline |
| Affinity Bancshares |
| Civista Bancshares |
Affinity Bancshares and Civista Bancshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affinity Bancshares and Civista Bancshares
The main advantage of trading using opposite Affinity Bancshares and Civista Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affinity Bancshares position performs unexpectedly, Civista Bancshares 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 Civista Bancshares will offset losses from the drop in Civista Bancshares' long position.| Affinity Bancshares vs. Home Federal Bancorp | Affinity Bancshares vs. Magyar Bancorp | Affinity Bancshares vs. Community West Bancshares |
| Civista Bancshares vs. Home Federal Bancorp | Civista Bancshares vs. First Financial Northwest | Civista Bancshares vs. First Northwest Bancorp | Civista Bancshares vs. First Capital |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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