Correlation Between Alpine Banks and FFW
Can any of the company-specific risk be diversified away by investing in both Alpine Banks and FFW 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 Alpine Banks and FFW into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alpine Banks of and FFW Corporation, you can compare the effects of market volatilities on Alpine Banks and FFW 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 Alpine Banks with a short position of FFW. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpine Banks and FFW.
Diversification Opportunities for Alpine Banks and FFW
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alpine and FFW is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Alpine Banks of and FFW Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FFW Corporation and Alpine Banks 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 Alpine Banks of are associated (or correlated) with FFW. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FFW Corporation has no effect on the direction of Alpine Banks i.e., Alpine Banks and FFW go up and down completely randomly.
Pair Corralation between Alpine Banks and FFW
Assuming the 90 days horizon Alpine Banks of is expected to generate 0.39 times more return on investment than FFW. However, Alpine Banks of is 2.56 times less risky than FFW. It trades about 0.08 of its potential returns per unit of risk. FFW Corporation is currently generating about 0.0 per unit of risk. If you would invest 2,631 in Alpine Banks of on September 2, 2024 and sell it today you would earn a total of 669.00 from holding Alpine Banks of or generate 25.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 65.32% |
| Values | Daily Returns |
Alpine Banks of vs. FFW Corp.
Performance |
| Timeline |
| Alpine Banks |
| FFW Corporation |
Alpine Banks and FFW Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alpine Banks and FFW
The main advantage of trading using opposite Alpine Banks and FFW positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpine Banks position performs unexpectedly, FFW 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 FFW will offset losses from the drop in FFW's long position.| Alpine Banks vs. Piraeus Bank SA | Alpine Banks vs. Turkiye Garanti Bankasi | Alpine Banks vs. Uwharrie Capital Corp |
| FFW vs. First Farmers Financial | FFW vs. Farmers Merchants Bancorp | FFW vs. Lakeland Financial | FFW vs. Eagle Financial Services |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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