Correlation Between Baraboo Bancorporation and CNB
Can any of the company-specific risk be diversified away by investing in both Baraboo Bancorporation and CNB 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 Baraboo Bancorporation and CNB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baraboo Bancorporation and CNB Corporation, you can compare the effects of market volatilities on Baraboo Bancorporation and CNB 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 Baraboo Bancorporation with a short position of CNB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baraboo Bancorporation and CNB.
Diversification Opportunities for Baraboo Bancorporation and CNB
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baraboo and CNB is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Baraboo Bancorp. and CNB Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNB Corporation and Baraboo Bancorporation 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 Baraboo Bancorporation are associated (or correlated) with CNB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNB Corporation has no effect on the direction of Baraboo Bancorporation i.e., Baraboo Bancorporation and CNB go up and down completely randomly.
Pair Corralation between Baraboo Bancorporation and CNB
Given the investment horizon of 90 days Baraboo Bancorporation is expected to generate 1.72 times more return on investment than CNB. However, Baraboo Bancorporation is 1.72 times more volatile than CNB Corporation. It trades about 0.22 of its potential returns per unit of risk. CNB Corporation is currently generating about -0.42 per unit of risk. If you would invest 310.00 in Baraboo Bancorporation on September 1, 2024 and sell it today you would earn a total of 20.00 from holding Baraboo Bancorporation or generate 6.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baraboo Bancorp. vs. CNB Corp.
Performance |
| Timeline |
| Baraboo Bancorporation |
| CNB Corporation |
Baraboo Bancorporation and CNB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baraboo Bancorporation and CNB
The main advantage of trading using opposite Baraboo Bancorporation and CNB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baraboo Bancorporation position performs unexpectedly, CNB 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 CNB will offset losses from the drop in CNB's long position.| Baraboo Bancorporation vs. Piraeus Bank SA | Baraboo Bancorporation vs. Turkiye Garanti Bankasi | Baraboo Bancorporation vs. Delhi Bank Corp | Baraboo Bancorporation vs. Uwharrie Capital Corp |
| CNB vs. Eastern Michigan Financial | CNB vs. Commercial National Financial | CNB vs. Mifflinburg Bancorp | CNB vs. Apollo 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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