Correlation Between First Busey and First Bancshares,
Can any of the company-specific risk be diversified away by investing in both First Busey and First Bancshares, 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 First Busey and First Bancshares, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Busey Corp and The First Bancshares,, you can compare the effects of market volatilities on First Busey and First Bancshares, 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 First Busey with a short position of First Bancshares,. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Busey and First Bancshares,.
Diversification Opportunities for First Busey and First Bancshares,
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and First is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding First Busey Corp and The First Bancshares, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Bancshares, and First Busey 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 First Busey Corp are associated (or correlated) with First Bancshares,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Bancshares, has no effect on the direction of First Busey i.e., First Busey and First Bancshares, go up and down completely randomly.
Pair Corralation between First Busey and First Bancshares,
Given the investment horizon of 90 days First Busey Corp is expected to under-perform the First Bancshares,. In addition to that, First Busey is 1.4 times more volatile than The First Bancshares,. It trades about -0.19 of its total potential returns per unit of risk. The First Bancshares, is currently generating about 0.07 per unit of volatility. If you would invest 3,317 in The First Bancshares, on January 8, 2025 and sell it today you would earn a total of 64.00 from holding The First Bancshares, or generate 1.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 81.82% |
| Values | Daily Returns |
First Busey Corp vs. The First Bancshares,
Performance |
| Timeline |
| First Busey Corp |
| First Bancshares, |
First Busey and First Bancshares, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Busey and First Bancshares,
The main advantage of trading using opposite First Busey and First Bancshares, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Busey position performs unexpectedly, First Bancshares, 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 First Bancshares, will offset losses from the drop in First Bancshares,'s long position.| First Busey vs. Home Federal Bancorp | First Busey vs. First Financial Northwest | First Busey vs. First Northwest Bancorp | First Busey vs. First Capital |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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