Correlation Between CB Financial and Central Valley
Can any of the company-specific risk be diversified away by investing in both CB Financial and Central 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 CB Financial and Central Valley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CB Financial Services and Central Valley Community, you can compare the effects of market volatilities on CB Financial and Central 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 CB Financial with a short position of Central Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of CB Financial and Central Valley.
Diversification Opportunities for CB Financial and Central Valley
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CBFV and Central is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding CB Financial Services and Central Valley Community in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Valley Community and CB Financial 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 CB Financial Services are associated (or correlated) with Central Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Valley Community has no effect on the direction of CB Financial i.e., CB Financial and Central Valley go up and down completely randomly.
Pair Corralation between CB Financial and Central Valley
If you would invest 2,206 in CB Financial Services on August 27, 2024 and sell it today you would earn a total of 794.00 from holding CB Financial Services or generate 35.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.54% |
| Values | Daily Returns |
CB Financial Services vs. Central Valley Community
Performance |
| Timeline |
| CB Financial Services |
| Central Valley Community |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CB Financial and Central Valley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CB Financial and Central Valley
The main advantage of trading using opposite CB Financial and Central Valley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CB Financial position performs unexpectedly, Central 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 Central Valley will offset losses from the drop in Central Valley's long position.| CB Financial vs. Fifth Third Bancorp | CB Financial vs. Zions Bancorporation | CB Financial vs. Huntington Bancshares Incorporated | CB Financial vs. PNC Financial Services |
| Central Valley vs. Home Federal Bancorp | Central Valley vs. First Northwest Bancorp | Central Valley vs. Magyar Bancorp | Central Valley vs. First United |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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