Correlation Between Delhi Bank and WCF Bancorp
Can any of the company-specific risk be diversified away by investing in both Delhi Bank and WCF Bancorp 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 Delhi Bank and WCF Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delhi Bank Corp and WCF Bancorp, you can compare the effects of market volatilities on Delhi Bank and WCF Bancorp 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 Delhi Bank with a short position of WCF Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delhi Bank and WCF Bancorp.
Diversification Opportunities for Delhi Bank and WCF Bancorp
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Delhi and WCF is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Delhi Bank Corp and WCF Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WCF Bancorp and Delhi Bank 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 Delhi Bank Corp are associated (or correlated) with WCF Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WCF Bancorp has no effect on the direction of Delhi Bank i.e., Delhi Bank and WCF Bancorp go up and down completely randomly.
Pair Corralation between Delhi Bank and WCF Bancorp
If you would invest 2,050 in Delhi Bank Corp on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Delhi Bank Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Delhi Bank Corp vs. WCF Bancorp
Performance |
| Timeline |
| Delhi Bank Corp |
| WCF Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Delhi Bank and WCF Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delhi Bank and WCF Bancorp
The main advantage of trading using opposite Delhi Bank and WCF Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delhi Bank position performs unexpectedly, WCF Bancorp 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 WCF Bancorp will offset losses from the drop in WCF Bancorp's long position.The idea behind Delhi Bank Corp and WCF Bancorp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| WCF Bancorp vs. CCSB Financial Corp | WCF Bancorp vs. Delhi Bank Corp | WCF Bancorp vs. Bank of Utica | WCF Bancorp vs. First Community Financial |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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