Correlation Between FNCB Bancorp and First Financial
Can any of the company-specific risk be diversified away by investing in both FNCB Bancorp and First Financial 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 FNCB Bancorp and First Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FNCB Bancorp and First Financial Northwest, you can compare the effects of market volatilities on FNCB Bancorp and First Financial 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 FNCB Bancorp with a short position of First Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of FNCB Bancorp and First Financial.
Diversification Opportunities for FNCB Bancorp and First Financial
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between FNCB and First is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding FNCB Bancorp and First Financial Northwest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Financial Northwest and FNCB 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 FNCB Bancorp are associated (or correlated) with First Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Financial Northwest has no effect on the direction of FNCB Bancorp i.e., FNCB Bancorp and First Financial go up and down completely randomly.
Pair Corralation between FNCB Bancorp and First Financial
If you would invest 675.00 in FNCB Bancorp on August 28, 2024 and sell it today you would earn a total of 0.00 from holding FNCB Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
FNCB Bancorp vs. First Financial Northwest
Performance |
| Timeline |
| FNCB Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| First Financial Northwest |
FNCB Bancorp and First Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FNCB Bancorp and First Financial
The main advantage of trading using opposite FNCB Bancorp and First Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FNCB Bancorp position performs unexpectedly, First Financial 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 First Financial will offset losses from the drop in First Financial's long position.| FNCB Bancorp vs. Home Federal Bancorp | FNCB Bancorp vs. LINKBANCORP | FNCB Bancorp vs. Rhinebeck Bancorp | FNCB Bancorp vs. Lake Shore Bancorp |
| First Financial vs. Fifth Third Bancorp | First Financial vs. Huntington Bancshares Incorporated | First Financial vs. Comerica | First Financial vs. MT Bank |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |