Correlation Between Lakeland Financial and Old National
Can any of the company-specific risk be diversified away by investing in both Lakeland Financial and Old 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 Lakeland Financial and Old National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lakeland Financial and Old National Bancorp, you can compare the effects of market volatilities on Lakeland Financial and Old 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 Lakeland Financial with a short position of Old National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lakeland Financial and Old National.
Diversification Opportunities for Lakeland Financial and Old National
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lakeland and Old is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Lakeland Financial and Old National Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old National Bancorp and Lakeland Financial 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 Lakeland Financial are associated (or correlated) with Old National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old National Bancorp has no effect on the direction of Lakeland Financial i.e., Lakeland Financial and Old National go up and down completely randomly.
Pair Corralation between Lakeland Financial and Old National
Given the investment horizon of 90 days Lakeland Financial is expected to generate 1.58 times less return on investment than Old National. But when comparing it to its historical volatility, Lakeland Financial is 1.28 times less risky than Old National. It trades about 0.21 of its potential returns per unit of risk. Old National Bancorp is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,912 in Old National Bancorp on September 2, 2024 and sell it today you would earn a total of 404.00 from holding Old National Bancorp or generate 21.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lakeland Financial vs. Old National Bancorp
Performance |
| Timeline |
| Lakeland Financial |
| Old National Bancorp |
Lakeland Financial and Old National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lakeland Financial and Old National
The main advantage of trading using opposite Lakeland Financial and Old National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lakeland Financial position performs unexpectedly, Old 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 Old National will offset losses from the drop in Old National's long position.| Lakeland Financial vs. Home Bancorp | Lakeland Financial vs. Heritage Financial | Lakeland Financial vs. First Northwest Bancorp | Lakeland Financial vs. HomeTrust Bancshares |
| Old National vs. Independent Bank | Old National vs. First Financial Bancorp | Old National vs. Lakeland Financial | Old National vs. National Bank Holdings |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |