Correlation Between Aozora Bank and Farmers Merchants
Can any of the company-specific risk be diversified away by investing in both Aozora Bank and Farmers Merchants 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 Aozora Bank and Farmers Merchants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aozora Bank and Farmers Merchants Bancorp, you can compare the effects of market volatilities on Aozora Bank and Farmers Merchants 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 Aozora Bank with a short position of Farmers Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aozora Bank and Farmers Merchants.
Diversification Opportunities for Aozora Bank and Farmers Merchants
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aozora and Farmers is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Aozora Bank and Farmers Merchants Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Farmers Merchants Bancorp and Aozora Bank 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 Aozora Bank are associated (or correlated) with Farmers Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Farmers Merchants Bancorp has no effect on the direction of Aozora Bank i.e., Aozora Bank and Farmers Merchants go up and down completely randomly.
Pair Corralation between Aozora Bank and Farmers Merchants
If you would invest 2,058 in Farmers Merchants Bancorp on September 3, 2024 and sell it today you would earn a total of 1,262 from holding Farmers Merchants Bancorp or generate 61.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Aozora Bank vs. Farmers Merchants Bancorp
Performance |
| Timeline |
| Aozora Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Farmers Merchants Bancorp |
Aozora Bank and Farmers Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aozora Bank and Farmers Merchants
The main advantage of trading using opposite Aozora Bank and Farmers Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aozora Bank position performs unexpectedly, Farmers Merchants 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 Farmers Merchants will offset losses from the drop in Farmers Merchants' long position.| Aozora Bank vs. Tower One Wireless | Aozora Bank vs. JBG SMITH Properties | Aozora Bank vs. Eastern Co | Aozora Bank vs. Western Acquisition Ventures |
| Farmers Merchants vs. JPMorgan Chase Co | Farmers Merchants vs. Citigroup | Farmers Merchants vs. Wells Fargo | Farmers Merchants vs. Toronto Dominion Bank |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |