Correlation Between Juniata Valley and Commercial National
Can any of the company-specific risk be diversified away by investing in both Juniata Valley and Commercial National 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 Juniata Valley and Commercial National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juniata Valley Financial and Commercial National Financial, you can compare the effects of market volatilities on Juniata Valley and Commercial National 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 Juniata Valley with a short position of Commercial National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniata Valley and Commercial National.
Diversification Opportunities for Juniata Valley and Commercial National
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Juniata and Commercial is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Juniata Valley Financial and Commercial National Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial National and Juniata Valley 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 Juniata Valley Financial are associated (or correlated) with Commercial National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial National has no effect on the direction of Juniata Valley i.e., Juniata Valley and Commercial National go up and down completely randomly.
Pair Corralation between Juniata Valley and Commercial National
Given the investment horizon of 90 days Juniata Valley Financial is expected to generate 1.65 times more return on investment than Commercial National. However, Juniata Valley is 1.65 times more volatile than Commercial National Financial. It trades about 0.25 of its potential returns per unit of risk. Commercial National Financial is currently generating about 0.1 per unit of risk. If you would invest 1,205 in Juniata Valley Financial on September 2, 2024 and sell it today you would earn a total of 145.00 from holding Juniata Valley Financial or generate 12.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juniata Valley Financial vs. Commercial National Financial
Performance |
| Timeline |
| Juniata Valley Financial |
| Commercial National |
Juniata Valley and Commercial National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juniata Valley and Commercial National
The main advantage of trading using opposite Juniata Valley and Commercial National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juniata Valley position performs unexpectedly, Commercial National 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 Commercial National will offset losses from the drop in Commercial National's long position.| Juniata Valley vs. FNB Inc | Juniata Valley vs. Apollo Bancorp | Juniata Valley vs. Commercial National Financial | Juniata Valley vs. Eastern Michigan Financial |
| Commercial National vs. Eastern Michigan Financial | Commercial National vs. Mifflinburg Bancorp | Commercial National vs. Apollo Bancorp | Commercial National vs. Community Bankers |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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