Correlation Between Eagle Bancorp and Comerica
Can any of the company-specific risk be diversified away by investing in both Eagle Bancorp and Comerica 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 Eagle Bancorp and Comerica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Bancorp Montana and Comerica, you can compare the effects of market volatilities on Eagle Bancorp and Comerica 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 Eagle Bancorp with a short position of Comerica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Bancorp and Comerica.
Diversification Opportunities for Eagle Bancorp and Comerica
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Eagle and Comerica is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Bancorp Montana and Comerica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comerica and Eagle 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 Eagle Bancorp Montana are associated (or correlated) with Comerica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comerica has no effect on the direction of Eagle Bancorp i.e., Eagle Bancorp and Comerica go up and down completely randomly.
Pair Corralation between Eagle Bancorp and Comerica
Given the investment horizon of 90 days Eagle Bancorp Montana is expected to generate 0.87 times more return on investment than Comerica. However, Eagle Bancorp Montana is 1.14 times less risky than Comerica. It trades about 0.01 of its potential returns per unit of risk. Comerica is currently generating about -0.19 per unit of risk. If you would invest 1,681 in Eagle Bancorp Montana on September 14, 2024 and sell it today you would earn a total of 2.00 from holding Eagle Bancorp Montana or generate 0.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Bancorp Montana vs. Comerica
Performance |
| Timeline |
| Eagle Bancorp Montana |
| Comerica |
Eagle Bancorp and Comerica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Bancorp and Comerica
The main advantage of trading using opposite Eagle Bancorp and Comerica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Bancorp position performs unexpectedly, Comerica 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 Comerica will offset losses from the drop in Comerica's long position.| Eagle Bancorp vs. Home Federal Bancorp | Eagle Bancorp vs. First Financial Northwest | Eagle Bancorp vs. First Northwest Bancorp | Eagle Bancorp vs. First Capital |
| Comerica vs. Western Alliance Bancorporation | Comerica vs. KeyCorp | Comerica vs. Truist Financial Corp | Comerica vs. Zions Bancorporation |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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