Correlation Between Magyar Bancorp and Main Street
Can any of the company-specific risk be diversified away by investing in both Magyar Bancorp and Main Street 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 Magyar Bancorp and Main Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magyar Bancorp and Main Street Financial, you can compare the effects of market volatilities on Magyar Bancorp and Main Street 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 Magyar Bancorp with a short position of Main Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magyar Bancorp and Main Street.
Diversification Opportunities for Magyar Bancorp and Main Street
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Magyar and Main is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Magyar Bancorp and Main Street Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Main Street Financial and Magyar Bancorp 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 Magyar Bancorp are associated (or correlated) with Main Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Main Street Financial has no effect on the direction of Magyar Bancorp i.e., Magyar Bancorp and Main Street go up and down completely randomly.
Pair Corralation between Magyar Bancorp and Main Street
Given the investment horizon of 90 days Magyar Bancorp is expected to generate 0.61 times more return on investment than Main Street. However, Magyar Bancorp is 1.64 times less risky than Main Street. It trades about 0.02 of its potential returns per unit of risk. Main Street Financial is currently generating about 0.01 per unit of risk. If you would invest 1,241 in Magyar Bancorp on August 26, 2024 and sell it today you would earn a total of 85.00 from holding Magyar Bancorp or generate 6.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.99% |
| Values | Daily Returns |
Magyar Bancorp vs. Main Street Financial
Performance |
| Timeline |
| Magyar Bancorp |
| Main Street Financial |
Magyar Bancorp and Main Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magyar Bancorp and Main Street
The main advantage of trading using opposite Magyar Bancorp and Main Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magyar Bancorp position performs unexpectedly, Main Street 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 Main Street will offset losses from the drop in Main Street's long position.| Magyar Bancorp vs. Home Federal Bancorp | Magyar Bancorp vs. Community West Bancshares | Magyar Bancorp vs. First Financial Northwest | Magyar Bancorp vs. First Northwest Bancorp |
| Main Street vs. CCFNB Bancorp | Main Street vs. Burke Herbert Financial | Main Street vs. First IC | Main Street vs. Enterprise Financial Services |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |