Correlation Between LINKBANCORP and Mifflinburg Bancorp
Can any of the company-specific risk be diversified away by investing in both LINKBANCORP and Mifflinburg Bancorp 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 LINKBANCORP and Mifflinburg Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LINKBANCORP and Mifflinburg Bancorp, you can compare the effects of market volatilities on LINKBANCORP and Mifflinburg Bancorp 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 LINKBANCORP with a short position of Mifflinburg Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of LINKBANCORP and Mifflinburg Bancorp.
Diversification Opportunities for LINKBANCORP and Mifflinburg Bancorp
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between LINKBANCORP and Mifflinburg is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding LINKBANCORP and Mifflinburg Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mifflinburg Bancorp and LINKBANCORP 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 LINKBANCORP are associated (or correlated) with Mifflinburg Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mifflinburg Bancorp has no effect on the direction of LINKBANCORP i.e., LINKBANCORP and Mifflinburg Bancorp go up and down completely randomly.
Pair Corralation between LINKBANCORP and Mifflinburg Bancorp
Given the investment horizon of 90 days LINKBANCORP is expected to generate 1.17 times less return on investment than Mifflinburg Bancorp. But when comparing it to its historical volatility, LINKBANCORP is 1.28 times less risky than Mifflinburg Bancorp. It trades about 0.03 of its potential returns per unit of risk. Mifflinburg Bancorp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,249 in Mifflinburg Bancorp on November 8, 2024 and sell it today you would earn a total of 138.00 from holding Mifflinburg Bancorp or generate 6.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 52.63% |
| Values | Daily Returns |
LINKBANCORP vs. Mifflinburg Bancorp
Performance |
| Timeline |
| LINKBANCORP |
| Mifflinburg Bancorp |
LINKBANCORP and Mifflinburg Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LINKBANCORP and Mifflinburg Bancorp
The main advantage of trading using opposite LINKBANCORP and Mifflinburg Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LINKBANCORP position performs unexpectedly, Mifflinburg Bancorp 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 Mifflinburg Bancorp will offset losses from the drop in Mifflinburg Bancorp's long position.| LINKBANCORP vs. Home Federal Bancorp | LINKBANCORP vs. Lake Shore Bancorp | LINKBANCORP vs. Community West Bancshares | LINKBANCORP vs. Magyar Bancorp |
| Mifflinburg Bancorp vs. Mauch Chunk Trust | Mifflinburg Bancorp vs. Juniata Valley Financial | Mifflinburg Bancorp vs. MBT Bancshares |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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