Correlation Between Cullman Bancorp and United Bankshares
Can any of the company-specific risk be diversified away by investing in both Cullman 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 Cullman 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 Cullman Bancorp and United Bankshares, you can compare the effects of market volatilities on Cullman 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 Cullman Bancorp with a short position of United Bankshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cullman Bancorp and United Bankshares.
Diversification Opportunities for Cullman Bancorp and United Bankshares
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cullman and United is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Cullman Bancorp and United Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Bankshares 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 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 Cullman Bancorp i.e., Cullman Bancorp and United Bankshares go up and down completely randomly.
Pair Corralation between Cullman Bancorp and United Bankshares
If you would invest 3,845 in United Bankshares on August 27, 2024 and sell it today you would earn a total of 436.00 from holding United Bankshares or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Cullman Bancorp vs. United Bankshares
Performance |
| Timeline |
| Cullman Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| United Bankshares |
Cullman Bancorp and United Bankshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cullman Bancorp and United Bankshares
The main advantage of trading using opposite Cullman Bancorp and United Bankshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cullman 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.| Cullman Bancorp vs. Home Federal Bancorp | Cullman Bancorp vs. Lake Shore Bancorp | Cullman Bancorp vs. Community West Bancshares | Cullman Bancorp vs. Magyar 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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