Correlation Between CCSB Financial and Lumbee Guaranty
Can any of the company-specific risk be diversified away by investing in both CCSB Financial and Lumbee Guaranty 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 CCSB Financial and Lumbee Guaranty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CCSB Financial Corp and Lumbee Guaranty Bank, you can compare the effects of market volatilities on CCSB Financial and Lumbee Guaranty 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 CCSB Financial with a short position of Lumbee Guaranty. Check out your portfolio center. Please also check ongoing floating volatility patterns of CCSB Financial and Lumbee Guaranty.
Diversification Opportunities for CCSB Financial and Lumbee Guaranty
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CCSB and Lumbee is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding CCSB Financial Corp and Lumbee Guaranty Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumbee Guaranty Bank and CCSB 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 CCSB Financial Corp are associated (or correlated) with Lumbee Guaranty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumbee Guaranty Bank has no effect on the direction of CCSB Financial i.e., CCSB Financial and Lumbee Guaranty go up and down completely randomly.
Pair Corralation between CCSB Financial and Lumbee Guaranty
Given the investment horizon of 90 days CCSB Financial Corp is expected to under-perform the Lumbee Guaranty. In addition to that, CCSB Financial is 1.07 times more volatile than Lumbee Guaranty Bank. It trades about -0.03 of its total potential returns per unit of risk. Lumbee Guaranty Bank is currently generating about 0.01 per unit of volatility. If you would invest 1,199 in Lumbee Guaranty Bank on September 2, 2024 and sell it today you would lose (9.00) from holding Lumbee Guaranty Bank or give up 0.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CCSB Financial Corp vs. Lumbee Guaranty Bank
Performance |
| Timeline |
| CCSB Financial Corp |
| Lumbee Guaranty Bank |
CCSB Financial and Lumbee Guaranty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CCSB Financial and Lumbee Guaranty
The main advantage of trading using opposite CCSB Financial and Lumbee Guaranty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CCSB Financial position performs unexpectedly, Lumbee Guaranty 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 Lumbee Guaranty will offset losses from the drop in Lumbee Guaranty's long position.| CCSB Financial vs. HUMANA INC | CCSB Financial vs. SCOR PK | CCSB Financial vs. Aquagold International | CCSB Financial vs. Thrivent High Yield |
| Lumbee Guaranty vs. Mission Valley Bancorp | Lumbee Guaranty vs. Nmb Financial Corp | Lumbee Guaranty vs. Japan Post Holdings | Lumbee Guaranty vs. MNB Holdings Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |