Correlation Between Mission Bancorp and Merchants Marine
Can any of the company-specific risk be diversified away by investing in both Mission Bancorp and Merchants Marine 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 Merchants Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mission Bancorp and Merchants Marine Bancorp, you can compare the effects of market volatilities on Mission Bancorp and Merchants Marine 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 Merchants Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mission Bancorp and Merchants Marine.
Diversification Opportunities for Mission Bancorp and Merchants Marine
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mission and Merchants is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Mission Bancorp and Merchants Marine Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merchants Marine 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 Merchants Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merchants Marine Bancorp has no effect on the direction of Mission Bancorp i.e., Mission Bancorp and Merchants Marine go up and down completely randomly.
Pair Corralation between Mission Bancorp and Merchants Marine
If you would invest 9,200 in Mission Bancorp on October 21, 2024 and sell it today you would earn a total of 0.00 from holding Mission Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Mission Bancorp vs. Merchants Marine Bancorp
Performance |
| Timeline |
| Mission Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Merchants Marine Bancorp |
Mission Bancorp and Merchants Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mission Bancorp and Merchants Marine
The main advantage of trading using opposite Mission Bancorp and Merchants Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mission Bancorp position performs unexpectedly, Merchants Marine 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 Merchants Marine will offset losses from the drop in Merchants Marine'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 |
| Merchants Marine vs. Mission Valley Bancorp | Merchants Marine vs. Harbor Bankshares | Merchants Marine vs. Oconee Financial | Merchants Marine vs. MF 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 Stocks Directory module to find actively traded stocks across global markets.
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