Correlation Between FNCB Bancorp and HV Bancorp
Can any of the company-specific risk be diversified away by investing in both FNCB Bancorp and HV Bancorp 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 HV Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FNCB Bancorp and HV Bancorp, you can compare the effects of market volatilities on FNCB Bancorp and HV Bancorp 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 HV Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of FNCB Bancorp and HV Bancorp.
Diversification Opportunities for FNCB Bancorp and HV Bancorp
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FNCB and HVBC is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding FNCB Bancorp and HV Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HV Bancorp 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 HV Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HV Bancorp has no effect on the direction of FNCB Bancorp i.e., FNCB Bancorp and HV Bancorp go up and down completely randomly.
Pair Corralation between FNCB Bancorp and HV Bancorp
If you would invest 3,460 in HV Bancorp on November 3, 2024 and sell it today you would earn a total of 0.00 from holding HV Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FNCB Bancorp vs. HV Bancorp
Performance |
| Timeline |
| FNCB Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| HV Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FNCB Bancorp and HV Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FNCB Bancorp and HV Bancorp
The main advantage of trading using opposite FNCB Bancorp and HV Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FNCB Bancorp position performs unexpectedly, HV Bancorp 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 HV Bancorp will offset losses from the drop in HV Bancorp's long position.| FNCB Bancorp vs. Home Federal Bancorp | FNCB Bancorp vs. LINKBANCORP | FNCB Bancorp vs. Rhinebeck Bancorp | FNCB Bancorp vs. Lake Shore Bancorp |
| HV Bancorp vs. Magyar Bancorp | HV Bancorp vs. Home Federal Bancorp | HV Bancorp vs. Community West Bancshares | HV Bancorp vs. Lake Shore 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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