Correlation Between Aozora Bank and Finward Bancorp
Can any of the company-specific risk be diversified away by investing in both Aozora Bank and Finward 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 Aozora Bank and Finward Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aozora Bank and Finward Bancorp, you can compare the effects of market volatilities on Aozora Bank and Finward 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 Aozora Bank with a short position of Finward Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aozora Bank and Finward Bancorp.
Diversification Opportunities for Aozora Bank and Finward Bancorp
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aozora and Finward is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Aozora Bank and Finward Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finward 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 Finward Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finward Bancorp has no effect on the direction of Aozora Bank i.e., Aozora Bank and Finward Bancorp go up and down completely randomly.
Pair Corralation between Aozora Bank and Finward Bancorp
If you would invest 1,989 in Aozora Bank on October 27, 2024 and sell it today you would earn a total of 0.00 from holding Aozora Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.21% |
| Values | Daily Returns |
Aozora Bank vs. Finward Bancorp
Performance |
| Timeline |
| Aozora Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Finward Bancorp |
Aozora Bank and Finward Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aozora Bank and Finward Bancorp
The main advantage of trading using opposite Aozora Bank and Finward Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aozora Bank position performs unexpectedly, Finward 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 Finward Bancorp will offset losses from the drop in Finward Bancorp's long position.| Aozora Bank vs. Lithia Motors | Aozora Bank vs. The Gap, | Aozora Bank vs. NioCorp Developments Ltd | Aozora Bank vs. Tradeweb Markets |
| Finward Bancorp vs. Community West Bancshares | Finward Bancorp vs. First Financial Northwest | Finward Bancorp vs. Oak Valley Bancorp | Finward Bancorp vs. Home Federal Bancorp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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