Correlation Between Cullman Bancorp and Southern Missouri
Can any of the company-specific risk be diversified away by investing in both Cullman Bancorp and Southern Missouri 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 Cullman Bancorp and Southern Missouri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cullman Bancorp and Southern Missouri Bancorp, you can compare the effects of market volatilities on Cullman Bancorp and Southern Missouri 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 Cullman Bancorp with a short position of Southern Missouri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cullman Bancorp and Southern Missouri.
Diversification Opportunities for Cullman Bancorp and Southern Missouri
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cullman and Southern is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Cullman Bancorp and Southern Missouri Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Missouri Bancorp and Cullman 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 Cullman Bancorp are associated (or correlated) with Southern Missouri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Missouri Bancorp has no effect on the direction of Cullman Bancorp i.e., Cullman Bancorp and Southern Missouri go up and down completely randomly.
Pair Corralation between Cullman Bancorp and Southern Missouri
Given the investment horizon of 90 days Cullman Bancorp is expected to under-perform the Southern Missouri. But the stock apears to be less risky and, when comparing its historical volatility, Cullman Bancorp is 2.24 times less risky than Southern Missouri. The stock trades about -0.09 of its potential returns per unit of risk. The Southern Missouri Bancorp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,222 in Southern Missouri Bancorp on November 5, 2024 and sell it today you would earn a total of 1,561 from holding Southern Missouri Bancorp or generate 36.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 43.5% |
| Values | Daily Returns |
Cullman Bancorp vs. Southern Missouri Bancorp
Performance |
| Timeline |
| Cullman Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Southern Missouri Bancorp |
Cullman Bancorp and Southern Missouri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cullman Bancorp and Southern Missouri
The main advantage of trading using opposite Cullman Bancorp and Southern Missouri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cullman Bancorp position performs unexpectedly, Southern Missouri 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 Southern Missouri will offset losses from the drop in Southern Missouri's long position.| Cullman Bancorp vs. Home Federal Bancorp | Cullman Bancorp vs. Lake Shore Bancorp | Cullman Bancorp vs. Community West Bancshares | Cullman Bancorp vs. Magyar Bancorp |
| Southern Missouri vs. Commerzbank AG | Southern Missouri vs. Investar Holding Corp | Southern Missouri vs. Colony Bankcorp | Southern Missouri vs. Western New England |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |