Correlation Between Mission Bancorp and MF Bancorp
Can any of the company-specific risk be diversified away by investing in both Mission Bancorp and MF 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 Mission Bancorp and MF Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mission Bancorp and MF Bancorp, you can compare the effects of market volatilities on Mission Bancorp and MF 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 Mission Bancorp with a short position of MF Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mission Bancorp and MF Bancorp.
Diversification Opportunities for Mission Bancorp and MF Bancorp
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mission and MFBP is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Mission Bancorp and MF Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MF Bancorp and Mission 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 Mission Bancorp are associated (or correlated) with MF Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MF Bancorp has no effect on the direction of Mission Bancorp i.e., Mission Bancorp and MF Bancorp go up and down completely randomly.
Pair Corralation between Mission Bancorp and MF Bancorp
If you would invest 1,900 in MF Bancorp on October 21, 2024 and sell it today you would earn a total of 350.00 from holding MF Bancorp or generate 18.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Mission Bancorp vs. MF Bancorp
Performance |
| Timeline |
| Mission Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MF Bancorp |
Mission Bancorp and MF Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mission Bancorp and MF Bancorp
The main advantage of trading using opposite Mission Bancorp and MF Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mission Bancorp position performs unexpectedly, MF 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 MF Bancorp will offset losses from the drop in MF Bancorp's long position.| Mission Bancorp vs. MNB Holdings Corp | Mission Bancorp vs. Harbor Bankshares | Mission Bancorp vs. Oconee Financial | Mission Bancorp vs. Mission Valley Bancorp |
| MF Bancorp vs. Citizens Bancshares Corp | MF Bancorp vs. Harbor Bankshares | MF Bancorp vs. United Bancorporation of | MF Bancorp vs. KS Bancorp |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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