Correlation Between OceanFirst Financial and Lakeland Bancorp
Can any of the company-specific risk be diversified away by investing in both OceanFirst Financial and Lakeland 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 OceanFirst Financial and Lakeland Bancorp 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 Lakeland Bancorp, you can compare the effects of market volatilities on OceanFirst Financial and Lakeland 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 OceanFirst Financial with a short position of Lakeland Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of OceanFirst Financial and Lakeland Bancorp.
Diversification Opportunities for OceanFirst Financial and Lakeland Bancorp
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OceanFirst and Lakeland is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding OceanFirst Financial Corp and Lakeland Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lakeland Bancorp 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 Lakeland Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lakeland Bancorp has no effect on the direction of OceanFirst Financial i.e., OceanFirst Financial and Lakeland Bancorp go up and down completely randomly.
Pair Corralation between OceanFirst Financial and Lakeland Bancorp
Given the investment horizon of 90 days OceanFirst Financial Corp is expected to generate 1.02 times more return on investment than Lakeland Bancorp. However, OceanFirst Financial is 1.02 times more volatile than Lakeland Bancorp. It trades about 0.0 of its potential returns per unit of risk. Lakeland Bancorp is currently generating about -0.07 per unit of risk. If you would invest 2,244 in OceanFirst Financial Corp on November 2, 2024 and sell it today you would lose (432.00) from holding OceanFirst Financial Corp or give up 19.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 22.67% |
| Values | Daily Returns |
OceanFirst Financial Corp vs. Lakeland Bancorp
Performance |
| Timeline |
| OceanFirst Financial Corp |
| Lakeland Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
OceanFirst Financial and Lakeland Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OceanFirst Financial and Lakeland Bancorp
The main advantage of trading using opposite OceanFirst Financial and Lakeland Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OceanFirst Financial position performs unexpectedly, Lakeland 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 Lakeland Bancorp will offset losses from the drop in Lakeland Bancorp'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 |
| Lakeland Bancorp vs. Peoples Bancorp | Lakeland Bancorp vs. Primis Financial Corp | Lakeland Bancorp vs. ConnectOne Bancorp | Lakeland Bancorp vs. LINKBANCORP |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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