Correlation Between Greenville Federal and Wake Forest
Can any of the company-specific risk be diversified away by investing in both Greenville Federal and Wake Forest 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 Wake Forest 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 Wake Forest Bancshares, you can compare the effects of market volatilities on Greenville Federal and Wake Forest 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 Wake Forest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenville Federal and Wake Forest.
Diversification Opportunities for Greenville Federal and Wake Forest
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Greenville and Wake is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Greenville Federal Financial and Wake Forest Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wake Forest Bancshares 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 Wake Forest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wake Forest Bancshares has no effect on the direction of Greenville Federal i.e., Greenville Federal and Wake Forest go up and down completely randomly.
Pair Corralation between Greenville Federal and Wake Forest
Given the investment horizon of 90 days Greenville Federal is expected to generate 400.29 times less return on investment than Wake Forest. But when comparing it to its historical volatility, Greenville Federal Financial is 2.39 times less risky than Wake Forest. It trades about 0.0 of its potential returns per unit of risk. Wake Forest Bancshares is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,738 in Wake Forest Bancshares on September 3, 2024 and sell it today you would earn a total of 1,500 from holding Wake Forest Bancshares or generate 86.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 30.65% |
| Values | Daily Returns |
Greenville Federal Financial vs. Wake Forest Bancshares
Performance |
| Timeline |
| Greenville Federal |
| Wake Forest Bancshares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Greenville Federal and Wake Forest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenville Federal and Wake Forest
The main advantage of trading using opposite Greenville Federal and Wake Forest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenville Federal position performs unexpectedly, Wake Forest 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 Wake Forest will offset losses from the drop in Wake Forest's long position.| Greenville Federal vs. First Bankers Trustshares | Greenville Federal vs. First Ottawa Bancshares | Greenville Federal vs. Coastal Carolina Bancshares | Greenville Federal vs. Citizens Bancorp Investment |
| Wake Forest vs. Home Federal Bancorp | Wake Forest vs. First Capital | Wake Forest vs. Magyar Bancorp | Wake Forest vs. Oak Valley 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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