Correlation Between ESSA Bancorp and Grupo Supervielle
Can any of the company-specific risk be diversified away by investing in both ESSA Bancorp and Grupo Supervielle 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 ESSA Bancorp and Grupo Supervielle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ESSA Bancorp and Grupo Supervielle SA, you can compare the effects of market volatilities on ESSA Bancorp and Grupo Supervielle 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 ESSA Bancorp with a short position of Grupo Supervielle. Check out your portfolio center. Please also check ongoing floating volatility patterns of ESSA Bancorp and Grupo Supervielle.
Diversification Opportunities for ESSA Bancorp and Grupo Supervielle
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ESSA and Grupo is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding ESSA Bancorp and Grupo Supervielle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Supervielle and ESSA 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 ESSA Bancorp are associated (or correlated) with Grupo Supervielle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Supervielle has no effect on the direction of ESSA Bancorp i.e., ESSA Bancorp and Grupo Supervielle go up and down completely randomly.
Pair Corralation between ESSA Bancorp and Grupo Supervielle
Given the investment horizon of 90 days ESSA Bancorp is expected to generate 4.82 times less return on investment than Grupo Supervielle. But when comparing it to its historical volatility, ESSA Bancorp is 1.64 times less risky than Grupo Supervielle. It trades about 0.05 of its potential returns per unit of risk. Grupo Supervielle SA is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 324.00 in Grupo Supervielle SA on August 24, 2024 and sell it today you would earn a total of 746.00 from holding Grupo Supervielle SA or generate 230.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ESSA Bancorp vs. Grupo Supervielle SA
Performance |
| Timeline |
| ESSA Bancorp |
| Grupo Supervielle |
ESSA Bancorp and Grupo Supervielle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ESSA Bancorp and Grupo Supervielle
The main advantage of trading using opposite ESSA Bancorp and Grupo Supervielle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ESSA Bancorp position performs unexpectedly, Grupo Supervielle 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 Grupo Supervielle will offset losses from the drop in Grupo Supervielle's long position.| ESSA Bancorp vs. Community West Bancshares | ESSA Bancorp vs. First Northwest Bancorp | ESSA Bancorp vs. First Community | ESSA Bancorp vs. Oak Valley Bancorp |
| Grupo Supervielle vs. Grupo Financiero Galicia | Grupo Supervielle vs. BBVA Banco Frances | Grupo Supervielle vs. Itau Unibanco Banco | Grupo Supervielle vs. Banco Bradesco SA |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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