Correlation Between Primis Financial and Premier Financial
Can any of the company-specific risk be diversified away by investing in both Primis Financial and Premier 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 Primis Financial and Premier Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Primis Financial Corp and Premier Financial Corp, you can compare the effects of market volatilities on Primis Financial and Premier 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 Primis Financial with a short position of Premier Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Primis Financial and Premier Financial.
Diversification Opportunities for Primis Financial and Premier Financial
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Primis and Premier is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Primis Financial Corp and Premier Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premier Financial Corp and Primis Financial 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 Primis Financial Corp are associated (or correlated) with Premier Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premier Financial Corp has no effect on the direction of Primis Financial i.e., Primis Financial and Premier Financial go up and down completely randomly.
Pair Corralation between Primis Financial and Premier Financial
Given the investment horizon of 90 days Primis Financial is expected to generate 1.93 times less return on investment than Premier Financial. In addition to that, Primis Financial is 1.03 times more volatile than Premier Financial Corp. It trades about 0.07 of its total potential returns per unit of risk. Premier Financial Corp is currently generating about 0.14 per unit of volatility. If you would invest 1,875 in Premier Financial Corp on September 1, 2024 and sell it today you would earn a total of 896.00 from holding Premier Financial Corp or generate 47.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Primis Financial Corp vs. Premier Financial Corp
Performance |
| Timeline |
| Primis Financial Corp |
| Premier Financial Corp |
Primis Financial and Premier Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Primis Financial and Premier Financial
The main advantage of trading using opposite Primis Financial and Premier Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Primis Financial position performs unexpectedly, Premier 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 Premier Financial will offset losses from the drop in Premier Financial's long position.| Primis Financial vs. Affinity Bancshares | Primis Financial vs. Home Federal Bancorp | Primis Financial vs. Community West Bancshares | Primis Financial vs. Investar Holding Corp |
| Premier Financial vs. Bankwell Financial Group | Premier Financial vs. Middlefield Banc | Premier Financial vs. Civista Bancshares | Premier Financial vs. Primis Financial Corp |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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