Correlation Between Freedom Bank and Elutia
Can any of the company-specific risk be diversified away by investing in both Freedom Bank and Elutia 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 Freedom Bank and Elutia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freedom Bank of and Elutia Inc, you can compare the effects of market volatilities on Freedom Bank and Elutia 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 Freedom Bank with a short position of Elutia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freedom Bank and Elutia.
Diversification Opportunities for Freedom Bank and Elutia
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Freedom and Elutia is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Freedom Bank of and Elutia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elutia Inc and Freedom Bank 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 Freedom Bank of are associated (or correlated) with Elutia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elutia Inc has no effect on the direction of Freedom Bank i.e., Freedom Bank and Elutia go up and down completely randomly.
Pair Corralation between Freedom Bank and Elutia
Given the investment horizon of 90 days Freedom Bank of is expected to generate 0.11 times more return on investment than Elutia. However, Freedom Bank of is 9.16 times less risky than Elutia. It trades about 0.3 of its potential returns per unit of risk. Elutia Inc is currently generating about -0.11 per unit of risk. If you would invest 1,027 in Freedom Bank of on November 18, 2024 and sell it today you would earn a total of 33.00 from holding Freedom Bank of or generate 3.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Freedom Bank of vs. Elutia Inc
Performance |
| Timeline |
| Freedom Bank |
| Elutia Inc |
Freedom Bank and Elutia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Freedom Bank and Elutia
The main advantage of trading using opposite Freedom Bank and Elutia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freedom Bank position performs unexpectedly, Elutia 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 Elutia will offset losses from the drop in Elutia's long position.| Freedom Bank vs. National Capital Bank | Freedom Bank vs. Community Heritage Financial | Freedom Bank vs. Citizens Financial Corp | Freedom Bank vs. Bank of Idaho |
| Elutia vs. Arrow Electronics | Elutia vs. Mako Mining Corp | Elutia vs. Allient | Elutia vs. Amkor Technology |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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