Correlation Between AIB Group and Plumas Bancorp
Can any of the company-specific risk be diversified away by investing in both AIB Group and Plumas 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 AIB Group and Plumas Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AIB Group plc and Plumas Bancorp, you can compare the effects of market volatilities on AIB Group and Plumas 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 AIB Group with a short position of Plumas Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIB Group and Plumas Bancorp.
Diversification Opportunities for AIB Group and Plumas Bancorp
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AIB and Plumas is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding AIB Group plc and Plumas Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plumas Bancorp and AIB Group 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 AIB Group plc are associated (or correlated) with Plumas Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plumas Bancorp has no effect on the direction of AIB Group i.e., AIB Group and Plumas Bancorp go up and down completely randomly.
Pair Corralation between AIB Group and Plumas Bancorp
Assuming the 90 days horizon AIB Group plc is expected to generate 0.91 times more return on investment than Plumas Bancorp. However, AIB Group plc is 1.1 times less risky than Plumas Bancorp. It trades about 0.41 of its potential returns per unit of risk. Plumas Bancorp is currently generating about -0.04 per unit of risk. If you would invest 1,200 in AIB Group plc on December 1, 2024 and sell it today you would earn a total of 184.00 from holding AIB Group plc or generate 15.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AIB Group plc vs. Plumas Bancorp
Performance |
| Timeline |
| AIB Group plc |
| Plumas Bancorp |
AIB Group and Plumas Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIB Group and Plumas Bancorp
The main advantage of trading using opposite AIB Group and Plumas Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIB Group position performs unexpectedly, Plumas 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 Plumas Bancorp will offset losses from the drop in Plumas Bancorp's long position.| AIB Group vs. HDFC Bank Limited | AIB Group vs. China Merchants Bank | AIB Group vs. China Merchants Bank | AIB Group vs. Fifth Third Bancorp |
| Plumas Bancorp vs. Home Federal Bancorp | Plumas Bancorp vs. First Northwest Bancorp | Plumas Bancorp vs. Lake Shore Bancorp | Plumas Bancorp vs. Community West Bancshares |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |