Correlation Between National Capital and Oregon Bancorp
Can any of the company-specific risk be diversified away by investing in both National Capital and Oregon 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 National Capital and Oregon Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Capital Bank and Oregon Bancorp, you can compare the effects of market volatilities on National Capital and Oregon 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 National Capital with a short position of Oregon Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Capital and Oregon Bancorp.
Diversification Opportunities for National Capital and Oregon Bancorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between National and Oregon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Capital Bank and Oregon Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oregon Bancorp and National Capital 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 National Capital Bank are associated (or correlated) with Oregon Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oregon Bancorp has no effect on the direction of National Capital i.e., National Capital and Oregon Bancorp go up and down completely randomly.
Pair Corralation between National Capital and Oregon Bancorp
Given the investment horizon of 90 days National Capital Bank is expected to generate 41.06 times more return on investment than Oregon Bancorp. However, National Capital is 41.06 times more volatile than Oregon Bancorp. It trades about 0.29 of its potential returns per unit of risk. Oregon Bancorp is currently generating about -0.01 per unit of risk. If you would invest 17,140 in National Capital Bank on October 27, 2024 and sell it today you would lose (10,840) from holding National Capital Bank or give up 63.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 77.2% |
| Values | Daily Returns |
National Capital Bank vs. Oregon Bancorp
Performance |
| Timeline |
| National Capital Bank |
| Oregon Bancorp |
National Capital and Oregon Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Capital and Oregon Bancorp
The main advantage of trading using opposite National Capital and Oregon Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Capital position performs unexpectedly, Oregon 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 Oregon Bancorp will offset losses from the drop in Oregon Bancorp's long position.| National Capital vs. Delhi Bank Corp | National Capital vs. CCSB Financial Corp | National Capital vs. Bank of Utica | National Capital vs. BEO Bancorp |
| Oregon Bancorp vs. National Capital Bank | Oregon Bancorp vs. Community Heritage Financial | Oregon Bancorp vs. Citizens Financial Corp | Oregon Bancorp vs. First Community Financial |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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