Correlation Between First Reliance and Glen Burnie
Can any of the company-specific risk be diversified away by investing in both First Reliance and Glen Burnie 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 First Reliance and Glen Burnie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Reliance Bancshares and Glen Burnie Bancorp, you can compare the effects of market volatilities on First Reliance and Glen Burnie 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 First Reliance with a short position of Glen Burnie. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Reliance and Glen Burnie.
Diversification Opportunities for First Reliance and Glen Burnie
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between First and Glen is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding First Reliance Bancshares and Glen Burnie Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glen Burnie Bancorp and First Reliance 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 First Reliance Bancshares are associated (or correlated) with Glen Burnie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glen Burnie Bancorp has no effect on the direction of First Reliance i.e., First Reliance and Glen Burnie go up and down completely randomly.
Pair Corralation between First Reliance and Glen Burnie
Given the investment horizon of 90 days First Reliance is expected to generate 60.05 times less return on investment than Glen Burnie. But when comparing it to its historical volatility, First Reliance Bancshares is 23.73 times less risky than Glen Burnie. It trades about 0.02 of its potential returns per unit of risk. Glen Burnie Bancorp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 811.00 in Glen Burnie Bancorp on August 26, 2024 and sell it today you would lose (251.00) from holding Glen Burnie Bancorp or give up 30.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Reliance Bancshares vs. Glen Burnie Bancorp
Performance |
| Timeline |
| First Reliance Bancshares |
| Glen Burnie Bancorp |
First Reliance and Glen Burnie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Reliance and Glen Burnie
The main advantage of trading using opposite First Reliance and Glen Burnie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Reliance position performs unexpectedly, Glen Burnie 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 Glen Burnie will offset losses from the drop in Glen Burnie's long position.| First Reliance vs. Standard Bank Group | First Reliance vs. PSB Holdings | First Reliance vs. United Overseas Bank | First Reliance vs. Turkiye Garanti Bankasi |
| Glen Burnie vs. First Bankers Trustshares | Glen Burnie vs. Greenville Federal Financial | Glen Burnie vs. First Ottawa Bancshares | Glen Burnie vs. Coastal Carolina Bancshares |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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