Correlation Between Community Investors and US Metro
Can any of the company-specific risk be diversified away by investing in both Community Investors and US Metro 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 Community Investors and US Metro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Community Investors Bancorp and US Metro Bancorp, you can compare the effects of market volatilities on Community Investors and US Metro 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 Community Investors with a short position of US Metro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Community Investors and US Metro.
Diversification Opportunities for Community Investors and US Metro
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Community and USMT is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Community Investors Bancorp and US Metro Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Metro Bancorp and Community Investors 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 Community Investors Bancorp are associated (or correlated) with US Metro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Metro Bancorp has no effect on the direction of Community Investors i.e., Community Investors and US Metro go up and down completely randomly.
Pair Corralation between Community Investors and US Metro
If you would invest 385.00 in US Metro Bancorp on August 24, 2024 and sell it today you would earn a total of 0.00 from holding US Metro Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Community Investors Bancorp vs. US Metro Bancorp
Performance |
| Timeline |
| Community Investors |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| US Metro Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Community Investors and US Metro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Community Investors and US Metro
The main advantage of trading using opposite Community Investors and US Metro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Community Investors position performs unexpectedly, US Metro 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 US Metro will offset losses from the drop in US Metro's long position.| Community Investors vs. CIB Marine Bancshares | Community Investors vs. United Bancorporation of | Community Investors vs. U I Financial | Community Investors vs. CoastalSouth Bancshares |
| US Metro vs. CMUV Bancorp | US Metro vs. Pioneer Bankcorp | US Metro vs. Summit Bancshares | US Metro vs. Liberty Northwest 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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