Correlation Between Oconee Federal and Orrstown Financial
Can any of the company-specific risk be diversified away by investing in both Oconee Federal and Orrstown Financial 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 Orrstown Financial 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 Orrstown Financial Services, you can compare the effects of market volatilities on Oconee Federal and Orrstown Financial 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 Orrstown Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oconee Federal and Orrstown Financial.
Diversification Opportunities for Oconee Federal and Orrstown Financial
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oconee and Orrstown is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Oconee Federal Financial and Orrstown Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orrstown Financial 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 Orrstown Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orrstown Financial has no effect on the direction of Oconee Federal i.e., Oconee Federal and Orrstown Financial go up and down completely randomly.
Pair Corralation between Oconee Federal and Orrstown Financial
If you would invest 3,752 in Orrstown Financial Services on August 25, 2024 and sell it today you would earn a total of 297.00 from holding Orrstown Financial Services or generate 7.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Oconee Federal Financial vs. Orrstown Financial Services
Performance |
| Timeline |
| Oconee Federal Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Orrstown Financial |
Oconee Federal and Orrstown Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oconee Federal and Orrstown Financial
The main advantage of trading using opposite Oconee Federal and Orrstown Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oconee Federal position performs unexpectedly, Orrstown Financial 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 Orrstown Financial will offset losses from the drop in Orrstown Financial's long position.| Oconee Federal vs. Home Federal Bancorp | Oconee Federal vs. Community West Bancshares | Oconee Federal vs. Magyar Bancorp |
| Orrstown Financial vs. Home Federal Bancorp | Orrstown Financial vs. LINKBANCORP | Orrstown Financial vs. Rhinebeck Bancorp | Orrstown Financial vs. Lake Shore 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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