Correlation Between ConnectOne Bancorp and United Bankshares
Can any of the company-specific risk be diversified away by investing in both ConnectOne Bancorp and United Bankshares 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 ConnectOne Bancorp and United Bankshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ConnectOne Bancorp and United Bankshares, you can compare the effects of market volatilities on ConnectOne Bancorp and United Bankshares 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 ConnectOne Bancorp with a short position of United Bankshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConnectOne Bancorp and United Bankshares.
Diversification Opportunities for ConnectOne Bancorp and United Bankshares
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ConnectOne and United is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding ConnectOne Bancorp and United Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Bankshares and ConnectOne Bancorp 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 ConnectOne Bancorp are associated (or correlated) with United Bankshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Bankshares has no effect on the direction of ConnectOne Bancorp i.e., ConnectOne Bancorp and United Bankshares go up and down completely randomly.
Pair Corralation between ConnectOne Bancorp and United Bankshares
Given the investment horizon of 90 days ConnectOne Bancorp is expected to generate 1.33 times more return on investment than United Bankshares. However, ConnectOne Bancorp is 1.33 times more volatile than United Bankshares. It trades about 0.07 of its potential returns per unit of risk. United Bankshares is currently generating about 0.07 per unit of risk. If you would invest 1,851 in ConnectOne Bancorp on August 24, 2024 and sell it today you would earn a total of 874.00 from holding ConnectOne Bancorp or generate 47.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ConnectOne Bancorp vs. United Bankshares
Performance |
| Timeline |
| ConnectOne Bancorp |
| United Bankshares |
ConnectOne Bancorp and United Bankshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ConnectOne Bancorp and United Bankshares
The main advantage of trading using opposite ConnectOne Bancorp and United Bankshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConnectOne Bancorp position performs unexpectedly, United Bankshares 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 United Bankshares will offset losses from the drop in United Bankshares' long position.| ConnectOne Bancorp vs. Rhinebeck Bancorp | ConnectOne Bancorp vs. Home Bancorp | ConnectOne Bancorp vs. Parke Bancorp | ConnectOne Bancorp vs. Great Southern Bancorp |
| United Bankshares vs. Peoples Bancorp | United Bankshares vs. Eagle Bancorp | United Bankshares vs. Northrim BanCorp | United Bankshares vs. Pacific Premier 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |