Correlation Between Oconee Federal and Magyar Bancorp
Can any of the company-specific risk be diversified away by investing in both Oconee Federal and Magyar 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 Oconee Federal and Magyar Bancorp 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 Magyar Bancorp, you can compare the effects of market volatilities on Oconee Federal and Magyar 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 Oconee Federal with a short position of Magyar Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oconee Federal and Magyar Bancorp.
Diversification Opportunities for Oconee Federal and Magyar Bancorp
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oconee and Magyar is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Oconee Federal Financial and Magyar Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magyar Bancorp 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 Magyar Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magyar Bancorp has no effect on the direction of Oconee Federal i.e., Oconee Federal and Magyar Bancorp go up and down completely randomly.
Pair Corralation between Oconee Federal and Magyar Bancorp
If you would invest 1,232 in Magyar Bancorp on August 27, 2024 and sell it today you would earn a total of 93.00 from holding Magyar Bancorp or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Oconee Federal Financial vs. Magyar Bancorp
Performance |
| Timeline |
| Oconee Federal Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Magyar Bancorp |
Oconee Federal and Magyar Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oconee Federal and Magyar Bancorp
The main advantage of trading using opposite Oconee Federal and Magyar Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oconee Federal position performs unexpectedly, Magyar 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 Magyar Bancorp will offset losses from the drop in Magyar Bancorp's long position.| Oconee Federal vs. Home Federal Bancorp | Oconee Federal vs. Community West Bancshares | Oconee Federal vs. Magyar Bancorp |
| Magyar Bancorp vs. Home Federal Bancorp | Magyar Bancorp vs. Community West Bancshares | Magyar Bancorp vs. First Financial Northwest | Magyar Bancorp 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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