Correlation Between Eagle Financial and Prime Meridian
Can any of the company-specific risk be diversified away by investing in both Eagle Financial and Prime Meridian 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 Financial and Prime Meridian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Financial Bancorp and Prime Meridian Holding, you can compare the effects of market volatilities on Eagle Financial and Prime Meridian 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 Financial with a short position of Prime Meridian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Financial and Prime Meridian.
Diversification Opportunities for Eagle Financial and Prime Meridian
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eagle and Prime is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Financial Bancorp and Prime Meridian Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prime Meridian Holding and Eagle Financial 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 Financial Bancorp are associated (or correlated) with Prime Meridian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prime Meridian Holding has no effect on the direction of Eagle Financial i.e., Eagle Financial and Prime Meridian go up and down completely randomly.
Pair Corralation between Eagle Financial and Prime Meridian
If you would invest 2,571 in Prime Meridian Holding on August 28, 2024 and sell it today you would earn a total of 328.00 from holding Prime Meridian Holding or generate 12.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Eagle Financial Bancorp vs. Prime Meridian Holding
Performance |
| Timeline |
| Eagle Financial Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Prime Meridian Holding |
Eagle Financial and Prime Meridian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Financial and Prime Meridian
The main advantage of trading using opposite Eagle Financial and Prime Meridian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Financial position performs unexpectedly, Prime Meridian 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 Prime Meridian will offset losses from the drop in Prime Meridian's long position.| Eagle Financial vs. Enterprise Financial Services | Eagle Financial vs. Pioneer Bancorp | Eagle Financial vs. LCNB Corporation | Eagle Financial vs. Affinity Bancshares |
| Prime Meridian vs. Invesco High Income | Prime Meridian vs. Blackrock Muniholdings Ny | Prime Meridian vs. MFS Investment Grade | Prime Meridian vs. Federated Premier Municipal |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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