Correlation Between Graham Holdings and Summit Bank
Can any of the company-specific risk be diversified away by investing in both Graham Holdings and Summit Bank 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 Graham Holdings and Summit Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graham Holdings Co and Summit Bank Group, you can compare the effects of market volatilities on Graham Holdings and Summit Bank 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 Graham Holdings with a short position of Summit Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graham Holdings and Summit Bank.
Diversification Opportunities for Graham Holdings and Summit Bank
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Graham and Summit is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Graham Holdings Co and Summit Bank Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Bank Group and Graham Holdings 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 Graham Holdings Co are associated (or correlated) with Summit Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Bank Group has no effect on the direction of Graham Holdings i.e., Graham Holdings and Summit Bank go up and down completely randomly.
Pair Corralation between Graham Holdings and Summit Bank
Considering the 90-day investment horizon Graham Holdings Co is expected to under-perform the Summit Bank. But the stock apears to be less risky and, when comparing its historical volatility, Graham Holdings Co is 3.64 times less risky than Summit Bank. The stock trades about -0.22 of its potential returns per unit of risk. The Summit Bank Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,430 in Summit Bank Group on October 9, 2024 and sell it today you would earn a total of 44.00 from holding Summit Bank Group or generate 3.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graham Holdings Co vs. Summit Bank Group
Performance |
| Timeline |
| Graham Holdings |
| Summit Bank Group |
Graham Holdings and Summit Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graham Holdings and Summit Bank
The main advantage of trading using opposite Graham Holdings and Summit Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graham Holdings position performs unexpectedly, Summit Bank 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 Summit Bank will offset losses from the drop in Summit Bank's long position.| Graham Holdings vs. Cable One | Graham Holdings vs. Adtalem Global Education | Graham Holdings vs. Axalta Coating Systems | Graham Holdings vs. Madison Square Garden |
| Summit Bank vs. Savi Financial | Summit Bank vs. Pacific West Bancorp | Summit Bank vs. Commencement Bancorp | Summit Bank vs. Merchants Marine 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |