Correlation Between OceanFirst Financial and Dime Community
Can any of the company-specific risk be diversified away by investing in both OceanFirst Financial and Dime Community 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 OceanFirst Financial and Dime Community into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OceanFirst Financial Corp and Dime Community Bancshares, you can compare the effects of market volatilities on OceanFirst Financial and Dime Community 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 OceanFirst Financial with a short position of Dime Community. Check out your portfolio center. Please also check ongoing floating volatility patterns of OceanFirst Financial and Dime Community.
Diversification Opportunities for OceanFirst Financial and Dime Community
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between OceanFirst and Dime is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding OceanFirst Financial Corp and Dime Community Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dime Community Bancshares and OceanFirst Financial 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 OceanFirst Financial Corp are associated (or correlated) with Dime Community. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dime Community Bancshares has no effect on the direction of OceanFirst Financial i.e., OceanFirst Financial and Dime Community go up and down completely randomly.
Pair Corralation between OceanFirst Financial and Dime Community
Given the investment horizon of 90 days OceanFirst Financial Corp is expected to generate 2.73 times more return on investment than Dime Community. However, OceanFirst Financial is 2.73 times more volatile than Dime Community Bancshares. It trades about 0.12 of its potential returns per unit of risk. Dime Community Bancshares is currently generating about 0.13 per unit of risk. If you would invest 1,739 in OceanFirst Financial Corp on August 28, 2024 and sell it today you would earn a total of 388.00 from holding OceanFirst Financial Corp or generate 22.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OceanFirst Financial Corp vs. Dime Community Bancshares
Performance |
| Timeline |
| OceanFirst Financial Corp |
| Dime Community Bancshares |
OceanFirst Financial and Dime Community Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OceanFirst Financial and Dime Community
The main advantage of trading using opposite OceanFirst Financial and Dime Community positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OceanFirst Financial position performs unexpectedly, Dime Community 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 Dime Community will offset losses from the drop in Dime Community's long position.| OceanFirst Financial vs. Flushing Financial | OceanFirst Financial vs. Dime Community Bancshares | OceanFirst Financial vs. Peapack Gladstone Financial | OceanFirst Financial vs. Heritage Financial |
| Dime Community vs. First Citizens BancShares | Dime Community vs. Fifth Third Bancorp | Dime Community vs. OceanFirst Financial Corp | Dime Community vs. Fifth Third 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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |