Correlation Between Home Bancorp and Amalgamated Bank
Can any of the company-specific risk be diversified away by investing in both Home Bancorp and Amalgamated 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 Home Bancorp and Amalgamated Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Bancorp and Amalgamated Bank, you can compare the effects of market volatilities on Home Bancorp and Amalgamated 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 Home Bancorp with a short position of Amalgamated Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Bancorp and Amalgamated Bank.
Diversification Opportunities for Home Bancorp and Amalgamated Bank
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Home and Amalgamated is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Home Bancorp and Amalgamated Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amalgamated Bank and Home Bancorp 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 Home Bancorp are associated (or correlated) with Amalgamated Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amalgamated Bank has no effect on the direction of Home Bancorp i.e., Home Bancorp and Amalgamated Bank go up and down completely randomly.
Pair Corralation between Home Bancorp and Amalgamated Bank
Given the investment horizon of 90 days Home Bancorp is expected to generate 1.06 times less return on investment than Amalgamated Bank. But when comparing it to its historical volatility, Home Bancorp is 1.25 times less risky than Amalgamated Bank. It trades about 0.17 of its potential returns per unit of risk. Amalgamated Bank is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 3,098 in Amalgamated Bank on August 25, 2024 and sell it today you would earn a total of 553.00 from holding Amalgamated Bank or generate 17.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Bancorp vs. Amalgamated Bank
Performance |
| Timeline |
| Home Bancorp |
| Amalgamated Bank |
Home Bancorp and Amalgamated Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Bancorp and Amalgamated Bank
The main advantage of trading using opposite Home Bancorp and Amalgamated Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Bancorp position performs unexpectedly, Amalgamated 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 Amalgamated Bank will offset losses from the drop in Amalgamated Bank's long position.| Home Bancorp vs. Home Federal Bancorp | Home Bancorp vs. Community West Bancshares | Home Bancorp vs. First Financial Northwest | Home Bancorp vs. First Capital |
| Amalgamated Bank vs. Home Bancorp | Amalgamated Bank vs. Community West Bancshares | Amalgamated Bank vs. First Community | Amalgamated Bank vs. Great Southern 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |