Correlation Between Equity Bancshares, and OptimumBank Holdings
Can any of the company-specific risk be diversified away by investing in both Equity Bancshares, and OptimumBank Holdings 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 Equity Bancshares, and OptimumBank Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equity Bancshares, and OptimumBank Holdings, you can compare the effects of market volatilities on Equity Bancshares, and OptimumBank Holdings 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 Equity Bancshares, with a short position of OptimumBank Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equity Bancshares, and OptimumBank Holdings.
Diversification Opportunities for Equity Bancshares, and OptimumBank Holdings
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Equity and OptimumBank is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Equity Bancshares, and OptimumBank Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptimumBank Holdings and Equity Bancshares, 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 Equity Bancshares, are associated (or correlated) with OptimumBank Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptimumBank Holdings has no effect on the direction of Equity Bancshares, i.e., Equity Bancshares, and OptimumBank Holdings go up and down completely randomly.
Pair Corralation between Equity Bancshares, and OptimumBank Holdings
Given the investment horizon of 90 days Equity Bancshares, is expected to generate 1.02 times more return on investment than OptimumBank Holdings. However, Equity Bancshares, is 1.02 times more volatile than OptimumBank Holdings. It trades about 0.16 of its potential returns per unit of risk. OptimumBank Holdings is currently generating about 0.07 per unit of risk. If you would invest 3,880 in Equity Bancshares, on September 12, 2024 and sell it today you would earn a total of 887.00 from holding Equity Bancshares, or generate 22.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equity Bancshares, vs. OptimumBank Holdings
Performance |
| Timeline |
| Equity Bancshares, |
| OptimumBank Holdings |
Equity Bancshares, and OptimumBank Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equity Bancshares, and OptimumBank Holdings
The main advantage of trading using opposite Equity Bancshares, and OptimumBank Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equity Bancshares, position performs unexpectedly, OptimumBank Holdings 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 OptimumBank Holdings will offset losses from the drop in OptimumBank Holdings' long position.| Equity Bancshares, vs. Comerica | Equity Bancshares, vs. Truist Financial Corp | Equity Bancshares, vs. Fifth Third Bancorp | Equity Bancshares, vs. Regions Financial |
| OptimumBank Holdings vs. First National Bank | OptimumBank Holdings vs. TrustCo Bank Corp | OptimumBank Holdings vs. Inter Co Class | OptimumBank Holdings vs. Rhinebeck 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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