Correlation Between Civista Bancshares and Chemung Financial
Can any of the company-specific risk be diversified away by investing in both Civista Bancshares and Chemung 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 Chemung 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 Chemung Financial Corp, you can compare the effects of market volatilities on Civista Bancshares and Chemung 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 Chemung Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Civista Bancshares and Chemung Financial.
Diversification Opportunities for Civista Bancshares and Chemung Financial
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Civista and Chemung is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Civista Bancshares and Chemung Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemung 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 Chemung Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemung Financial Corp has no effect on the direction of Civista Bancshares i.e., Civista Bancshares and Chemung Financial go up and down completely randomly.
Pair Corralation between Civista Bancshares and Chemung Financial
Given the investment horizon of 90 days Civista Bancshares is expected to generate 1.42 times more return on investment than Chemung Financial. However, Civista Bancshares is 1.42 times more volatile than Chemung Financial Corp. It trades about 0.35 of its potential returns per unit of risk. Chemung Financial Corp is currently generating about 0.23 per unit of risk. If you would invest 1,859 in Civista Bancshares on August 30, 2024 and sell it today you would earn a total of 422.00 from holding Civista Bancshares or generate 22.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Civista Bancshares vs. Chemung Financial Corp
Performance |
| Timeline |
| Civista Bancshares |
| Chemung Financial Corp |
Civista Bancshares and Chemung Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Civista Bancshares and Chemung Financial
The main advantage of trading using opposite Civista Bancshares and Chemung Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Civista Bancshares position performs unexpectedly, Chemung 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 Chemung Financial will offset losses from the drop in Chemung 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 |
| Chemung Financial vs. Finward Bancorp | Chemung Financial vs. Community West Bancshares | Chemung Financial vs. First Financial Northwest | Chemung Financial vs. Oak Valley 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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