Correlation Between Logansport Financial and Eagle Financial
Can any of the company-specific risk be diversified away by investing in both Logansport Financial and Eagle 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 Logansport Financial and Eagle Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Logansport Financial Corp and Eagle Financial Services, you can compare the effects of market volatilities on Logansport Financial and Eagle 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 Logansport Financial with a short position of Eagle Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Logansport Financial and Eagle Financial.
Diversification Opportunities for Logansport Financial and Eagle Financial
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Logansport and Eagle is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Logansport Financial Corp and Eagle Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Financial Services and Logansport 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 Logansport Financial Corp are associated (or correlated) with Eagle Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Financial Services has no effect on the direction of Logansport Financial i.e., Logansport Financial and Eagle Financial go up and down completely randomly.
Pair Corralation between Logansport Financial and Eagle Financial
If you would invest 3,135 in Eagle Financial Services on September 2, 2024 and sell it today you would earn a total of 415.00 from holding Eagle Financial Services or generate 13.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.36% |
| Values | Daily Returns |
Logansport Financial Corp vs. Eagle Financial Services
Performance |
| Timeline |
| Logansport Financial Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Eagle Financial Services |
Logansport Financial and Eagle Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Logansport Financial and Eagle Financial
The main advantage of trading using opposite Logansport Financial and Eagle Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logansport Financial position performs unexpectedly, Eagle 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 Eagle Financial will offset losses from the drop in Eagle Financial's long position.The idea behind Logansport Financial Corp and Eagle Financial Services pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Eagle Financial vs. HUMANA INC | Eagle Financial vs. SCOR PK | Eagle Financial vs. Aquagold International | Eagle Financial vs. Thrivent High Yield |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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