Correlation Between Greenville Federal and Kentucky First
Can any of the company-specific risk be diversified away by investing in both Greenville Federal and Kentucky First 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 Greenville Federal and Kentucky First into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenville Federal Financial and Kentucky First Federal, you can compare the effects of market volatilities on Greenville Federal and Kentucky First 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 Greenville Federal with a short position of Kentucky First. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenville Federal and Kentucky First.
Diversification Opportunities for Greenville Federal and Kentucky First
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Greenville and Kentucky is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Greenville Federal Financial and Kentucky First Federal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kentucky First Federal and Greenville Federal 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 Greenville Federal Financial are associated (or correlated) with Kentucky First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kentucky First Federal has no effect on the direction of Greenville Federal i.e., Greenville Federal and Kentucky First go up and down completely randomly.
Pair Corralation between Greenville Federal and Kentucky First
Given the investment horizon of 90 days Greenville Federal Financial is expected to generate 0.95 times more return on investment than Kentucky First. However, Greenville Federal Financial is 1.06 times less risky than Kentucky First. It trades about 0.0 of its potential returns per unit of risk. Kentucky First Federal is currently generating about -0.05 per unit of risk. If you would invest 900.00 in Greenville Federal Financial on August 26, 2024 and sell it today you would lose (200.00) from holding Greenville Federal Financial or give up 22.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Greenville Federal Financial vs. Kentucky First Federal
Performance |
| Timeline |
| Greenville Federal |
| Kentucky First Federal |
Greenville Federal and Kentucky First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenville Federal and Kentucky First
The main advantage of trading using opposite Greenville Federal and Kentucky First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenville Federal position performs unexpectedly, Kentucky First 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 Kentucky First will offset losses from the drop in Kentucky First's long position.| Greenville Federal vs. Standard Bank Group | Greenville Federal vs. PSB Holdings | Greenville Federal vs. United Overseas Bank | Greenville Federal vs. Turkiye Garanti Bankasi |
| Kentucky First vs. Home Federal Bancorp | Kentucky First vs. Lake Shore Bancorp | Kentucky First vs. Commerzbank AG | Kentucky First vs. Investar Holding 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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