Correlation Between Civista Bancshares and Bogota Financial
Can any of the company-specific risk be diversified away by investing in both Civista Bancshares and Bogota Financial 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 Civista Bancshares and Bogota Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Civista Bancshares and Bogota Financial Corp, you can compare the effects of market volatilities on Civista Bancshares and Bogota Financial 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 Civista Bancshares with a short position of Bogota Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Civista Bancshares and Bogota Financial.
Diversification Opportunities for Civista Bancshares and Bogota Financial
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Civista and Bogota is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Civista Bancshares and Bogota Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bogota Financial Corp and Civista Bancshares 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 Civista Bancshares are associated (or correlated) with Bogota Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bogota Financial Corp has no effect on the direction of Civista Bancshares i.e., Civista Bancshares and Bogota Financial go up and down completely randomly.
Pair Corralation between Civista Bancshares and Bogota Financial
Given the investment horizon of 90 days Civista Bancshares is expected to generate 1.1 times more return on investment than Bogota Financial. However, Civista Bancshares is 1.1 times more volatile than Bogota Financial Corp. It trades about 0.21 of its potential returns per unit of risk. Bogota Financial Corp is currently generating about 0.08 per unit of risk. If you would invest 2,039 in Civista Bancshares on November 3, 2024 and sell it today you would earn a total of 167.00 from holding Civista Bancshares or generate 8.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Civista Bancshares vs. Bogota Financial Corp
Performance |
| Timeline |
| Civista Bancshares |
| Bogota Financial Corp |
Civista Bancshares and Bogota Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Civista Bancshares and Bogota Financial
The main advantage of trading using opposite Civista Bancshares and Bogota Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Civista Bancshares position performs unexpectedly, Bogota Financial 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 Bogota Financial will offset losses from the drop in Bogota Financial's long position.| Civista Bancshares vs. Home Federal Bancorp | Civista Bancshares vs. First Financial Northwest | Civista Bancshares vs. First Northwest Bancorp | Civista Bancshares vs. First Capital |
| Bogota Financial vs. Home Federal Bancorp | Bogota Financial vs. First Financial Northwest | Bogota Financial vs. First Northwest Bancorp | Bogota Financial vs. First Capital |
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 CEOs Directory module to screen CEOs from public companies around the world.
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