Correlation Between Eagle Bancorp and Investar Holding
Can any of the company-specific risk be diversified away by investing in both Eagle Bancorp and Investar Holding 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 Investar Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Bancorp and Investar Holding Corp, you can compare the effects of market volatilities on Eagle Bancorp and Investar Holding 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 Investar Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Bancorp and Investar Holding.
Diversification Opportunities for Eagle Bancorp and Investar Holding
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Eagle and Investar is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Bancorp and Investar Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investar Holding Corp 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 are associated (or correlated) with Investar Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investar Holding Corp has no effect on the direction of Eagle Bancorp i.e., Eagle Bancorp and Investar Holding go up and down completely randomly.
Pair Corralation between Eagle Bancorp and Investar Holding
Given the investment horizon of 90 days Eagle Bancorp is expected to generate 1.12 times less return on investment than Investar Holding. In addition to that, Eagle Bancorp is 1.12 times more volatile than Investar Holding Corp. It trades about 0.17 of its total potential returns per unit of risk. Investar Holding Corp is currently generating about 0.22 per unit of volatility. If you would invest 2,123 in Investar Holding Corp on August 27, 2024 and sell it today you would earn a total of 313.00 from holding Investar Holding Corp or generate 14.74% 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 vs. Investar Holding Corp
Performance |
| Timeline |
| Eagle Bancorp |
| Investar Holding Corp |
Eagle Bancorp and Investar Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Bancorp and Investar Holding
The main advantage of trading using opposite Eagle Bancorp and Investar Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Bancorp position performs unexpectedly, Investar Holding 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 Investar Holding will offset losses from the drop in Investar Holding's long position.| Eagle Bancorp vs. Fifth Third Bancorp | Eagle Bancorp vs. Zions Bancorporation | Eagle Bancorp vs. Huntington Bancshares Incorporated | Eagle Bancorp vs. Comerica |
| Investar Holding vs. Magyar Bancorp | Investar Holding vs. Home Federal Bancorp | Investar Holding vs. Community West Bancshares | Investar Holding vs. First Northwest 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |