Correlation Between BancFirst and Codorus Valley
Can any of the company-specific risk be diversified away by investing in both BancFirst and Codorus Valley 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 BancFirst and Codorus Valley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BancFirst and Codorus Valley Bancorp, you can compare the effects of market volatilities on BancFirst and Codorus Valley 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 BancFirst with a short position of Codorus Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of BancFirst and Codorus Valley.
Diversification Opportunities for BancFirst and Codorus Valley
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between BancFirst and Codorus is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding BancFirst and Codorus Valley Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codorus Valley Bancorp and BancFirst 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 BancFirst are associated (or correlated) with Codorus Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codorus Valley Bancorp has no effect on the direction of BancFirst i.e., BancFirst and Codorus Valley go up and down completely randomly.
Pair Corralation between BancFirst and Codorus Valley
Given the investment horizon of 90 days BancFirst is expected to generate 1.86 times more return on investment than Codorus Valley. However, BancFirst is 1.86 times more volatile than Codorus Valley Bancorp. It trades about 0.12 of its potential returns per unit of risk. Codorus Valley Bancorp is currently generating about 0.15 per unit of risk. If you would invest 8,472 in BancFirst on September 3, 2024 and sell it today you would earn a total of 4,156 from holding BancFirst or generate 49.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 35.54% |
| Values | Daily Returns |
BancFirst vs. Codorus Valley Bancorp
Performance |
| Timeline |
| BancFirst |
| Codorus Valley Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
BancFirst and Codorus Valley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BancFirst and Codorus Valley
The main advantage of trading using opposite BancFirst and Codorus Valley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BancFirst position performs unexpectedly, Codorus Valley 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 Codorus Valley will offset losses from the drop in Codorus Valley's long position.| BancFirst vs. Glacier Bancorp | BancFirst vs. BOK Financial | BancFirst vs. First Financial Bancorp | BancFirst vs. First Bancorp |
| Codorus Valley vs. Home Federal Bancorp | Codorus Valley vs. First Financial Northwest | Codorus Valley vs. First Northwest Bancorp | Codorus Valley 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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