Correlation Between Oconee Federal and Investar Holding
Can any of the company-specific risk be diversified away by investing in both Oconee Federal and Investar Holding 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 Oconee Federal and Investar Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oconee Federal Financial and Investar Holding Corp, you can compare the effects of market volatilities on Oconee Federal and Investar Holding 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 Oconee Federal with a short position of Investar Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oconee Federal and Investar Holding.
Diversification Opportunities for Oconee Federal and Investar Holding
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Oconee and Investar is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Oconee Federal Financial and Investar Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investar Holding Corp and Oconee Federal 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 Oconee Federal Financial are associated (or correlated) with Investar Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investar Holding Corp has no effect on the direction of Oconee Federal i.e., Oconee Federal and Investar Holding go up and down completely randomly.
Pair Corralation between Oconee Federal and Investar Holding
If you would invest 1,850 in Investar Holding Corp on November 2, 2024 and sell it today you would earn a total of 63.00 from holding Investar Holding Corp or generate 3.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.97% |
| Values | Daily Returns |
Oconee Federal Financial vs. Investar Holding Corp
Performance |
| Timeline |
| Oconee Federal Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Investar Holding Corp |
Oconee Federal and Investar Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oconee Federal and Investar Holding
The main advantage of trading using opposite Oconee Federal and Investar Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oconee Federal position performs unexpectedly, Investar Holding 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 Investar Holding will offset losses from the drop in Investar Holding's long position.| Oconee Federal vs. Home Federal Bancorp | Oconee Federal vs. Community West Bancshares | Oconee Federal vs. Magyar Bancorp |
| Investar Holding vs. Magyar Bancorp | Investar Holding vs. Home Federal Bancorp | Investar Holding vs. Community West Bancshares | Investar Holding vs. First Northwest 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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