Correlation Between Oconee Federal and Prime Meridian
Can any of the company-specific risk be diversified away by investing in both Oconee Federal and Prime Meridian 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 Prime Meridian 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 Prime Meridian Holding, you can compare the effects of market volatilities on Oconee Federal and Prime Meridian 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 Prime Meridian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oconee Federal and Prime Meridian.
Diversification Opportunities for Oconee Federal and Prime Meridian
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oconee and Prime is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Oconee Federal Financial and Prime Meridian Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prime Meridian Holding 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 Prime Meridian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prime Meridian Holding has no effect on the direction of Oconee Federal i.e., Oconee Federal and Prime Meridian go up and down completely randomly.
Pair Corralation between Oconee Federal and Prime Meridian
If you would invest 2,375 in Prime Meridian Holding on August 24, 2024 and sell it today you would earn a total of 450.00 from holding Prime Meridian Holding or generate 18.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Oconee Federal Financial vs. Prime Meridian Holding
Performance |
| Timeline |
| Oconee Federal Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Prime Meridian Holding |
Oconee Federal and Prime Meridian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oconee Federal and Prime Meridian
The main advantage of trading using opposite Oconee Federal and Prime Meridian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oconee Federal position performs unexpectedly, Prime Meridian 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 Prime Meridian will offset losses from the drop in Prime Meridian's long position.| Oconee Federal vs. Home Federal Bancorp | Oconee Federal vs. Community West Bancshares | Oconee Federal vs. Magyar Bancorp |
| Prime Meridian vs. Village Bank and | Prime Meridian vs. William Penn Bancorp | Prime Meridian vs. Pathfinder 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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