Correlation Between Mechanics Bank and Origin Bancorp
Can any of the company-specific risk be diversified away by investing in both Mechanics Bank and Origin 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 Mechanics Bank and Origin Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mechanics Bank and Origin Bancorp, you can compare the effects of market volatilities on Mechanics Bank and Origin 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 Mechanics Bank with a short position of Origin Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mechanics Bank and Origin Bancorp.
Diversification Opportunities for Mechanics Bank and Origin Bancorp
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mechanics and Origin is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Mechanics Bank and Origin Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Bancorp and Mechanics Bank 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 Mechanics Bank are associated (or correlated) with Origin Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Bancorp has no effect on the direction of Mechanics Bank i.e., Mechanics Bank and Origin Bancorp go up and down completely randomly.
Pair Corralation between Mechanics Bank and Origin Bancorp
If you would invest 2,861 in Origin Bancorp on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Origin Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mechanics Bank vs. Origin Bancorp
Performance |
| Timeline |
| Mechanics Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Origin Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Mechanics Bank and Origin Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mechanics Bank and Origin Bancorp
The main advantage of trading using opposite Mechanics Bank and Origin Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mechanics Bank position performs unexpectedly, Origin 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 Origin Bancorp will offset losses from the drop in Origin Bancorp's long position.| Mechanics Bank vs. Merchants Marine Bancorp | Mechanics Bank vs. MNB Holdings Corp | Mechanics Bank vs. Oconee Financial | Mechanics Bank vs. Harbor Bankshares |
| Origin Bancorp vs. Home Federal Bancorp | Origin Bancorp vs. First Financial Northwest | Origin Bancorp vs. First Northwest Bancorp | Origin Bancorp vs. First Capital |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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