Correlation Between Investar Holding and Southern Missouri
Can any of the company-specific risk be diversified away by investing in both Investar Holding and Southern Missouri 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 Investar Holding and Southern Missouri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investar Holding Corp and Southern Missouri Bancorp, you can compare the effects of market volatilities on Investar Holding and Southern Missouri 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 Investar Holding with a short position of Southern Missouri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investar Holding and Southern Missouri.
Diversification Opportunities for Investar Holding and Southern Missouri
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Investar and Southern is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Investar Holding Corp and Southern Missouri Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Missouri Bancorp and Investar Holding 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 Investar Holding Corp are associated (or correlated) with Southern Missouri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Missouri Bancorp has no effect on the direction of Investar Holding i.e., Investar Holding and Southern Missouri go up and down completely randomly.
Pair Corralation between Investar Holding and Southern Missouri
Given the investment horizon of 90 days Investar Holding is expected to generate 1.11 times less return on investment than Southern Missouri. But when comparing it to its historical volatility, Investar Holding Corp is 1.27 times less risky than Southern Missouri. It trades about 0.13 of its potential returns per unit of risk. Southern Missouri Bancorp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4,233 in Southern Missouri Bancorp on August 27, 2024 and sell it today you would earn a total of 2,406 from holding Southern Missouri Bancorp or generate 56.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Investar Holding Corp vs. Southern Missouri Bancorp
Performance |
| Timeline |
| Investar Holding Corp |
| Southern Missouri Bancorp |
Investar Holding and Southern Missouri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investar Holding and Southern Missouri
The main advantage of trading using opposite Investar Holding and Southern Missouri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investar Holding position performs unexpectedly, Southern Missouri 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 Southern Missouri will offset losses from the drop in Southern Missouri's long position.| Investar Holding vs. Magyar Bancorp | Investar Holding vs. Home Federal Bancorp | Investar Holding vs. Community West Bancshares | Investar Holding vs. First Northwest Bancorp |
| Southern Missouri vs. Commerzbank AG | Southern Missouri vs. Investar Holding Corp | Southern Missouri vs. Colony Bankcorp | Southern Missouri vs. Western New England |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |