Correlation Between Luther Burbank and Chemung Financial
Can any of the company-specific risk be diversified away by investing in both Luther Burbank and Chemung Financial 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 Luther Burbank and Chemung Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luther Burbank and Chemung Financial Corp, you can compare the effects of market volatilities on Luther Burbank and Chemung Financial 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 Luther Burbank with a short position of Chemung Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luther Burbank and Chemung Financial.
Diversification Opportunities for Luther Burbank and Chemung Financial
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Luther and Chemung is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Luther Burbank and Chemung Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemung Financial Corp and Luther Burbank 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 Luther Burbank are associated (or correlated) with Chemung Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemung Financial Corp has no effect on the direction of Luther Burbank i.e., Luther Burbank and Chemung Financial go up and down completely randomly.
Pair Corralation between Luther Burbank and Chemung Financial
Considering the 90-day investment horizon Luther Burbank is expected to under-perform the Chemung Financial. In addition to that, Luther Burbank is 1.59 times more volatile than Chemung Financial Corp. It trades about -0.02 of its total potential returns per unit of risk. Chemung Financial Corp is currently generating about 0.03 per unit of volatility. If you would invest 4,276 in Chemung Financial Corp on August 30, 2024 and sell it today you would earn a total of 907.00 from holding Chemung Financial Corp or generate 21.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 31.31% |
| Values | Daily Returns |
Luther Burbank vs. Chemung Financial Corp
Performance |
| Timeline |
| Luther Burbank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Chemung Financial Corp |
Luther Burbank and Chemung Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luther Burbank and Chemung Financial
The main advantage of trading using opposite Luther Burbank and Chemung Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luther Burbank position performs unexpectedly, Chemung Financial 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 Chemung Financial will offset losses from the drop in Chemung Financial's long position.| Luther Burbank vs. First Community | Luther Burbank vs. Community West Bancshares | Luther Burbank vs. First Financial Northwest | Luther Burbank vs. First Northwest Bancorp |
| Chemung Financial vs. Finward Bancorp | Chemung Financial vs. Community West Bancshares | Chemung Financial vs. First Financial Northwest | Chemung Financial 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 CEOs Directory module to screen CEOs from public companies around the world.
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