Correlation Between OP Bancorp and Pioneer Bancorp
Can any of the company-specific risk be diversified away by investing in both OP Bancorp and Pioneer 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 OP Bancorp and Pioneer Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OP Bancorp and Pioneer Bancorp, you can compare the effects of market volatilities on OP Bancorp and Pioneer 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 OP Bancorp with a short position of Pioneer Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of OP Bancorp and Pioneer Bancorp.
Diversification Opportunities for OP Bancorp and Pioneer Bancorp
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between OPBK and Pioneer is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding OP Bancorp and Pioneer Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Bancorp and OP Bancorp 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 OP Bancorp are associated (or correlated) with Pioneer Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Bancorp has no effect on the direction of OP Bancorp i.e., OP Bancorp and Pioneer Bancorp go up and down completely randomly.
Pair Corralation between OP Bancorp and Pioneer Bancorp
Given the investment horizon of 90 days OP Bancorp is expected to generate 3.49 times more return on investment than Pioneer Bancorp. However, OP Bancorp is 3.49 times more volatile than Pioneer Bancorp. It trades about 0.3 of its potential returns per unit of risk. Pioneer Bancorp is currently generating about 0.32 per unit of risk. If you would invest 1,464 in OP Bancorp on September 2, 2024 and sell it today you would earn a total of 269.00 from holding OP Bancorp or generate 18.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
OP Bancorp vs. Pioneer Bancorp
Performance |
| Timeline |
| OP Bancorp |
| Pioneer Bancorp |
OP Bancorp and Pioneer Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OP Bancorp and Pioneer Bancorp
The main advantage of trading using opposite OP Bancorp and Pioneer Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OP Bancorp position performs unexpectedly, Pioneer 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 Pioneer Bancorp will offset losses from the drop in Pioneer Bancorp's long position.| OP Bancorp vs. PCB Bancorp | OP Bancorp vs. Hope Bancorp | OP Bancorp vs. RBB Bancorp | OP Bancorp vs. BayCom Corp |
| Pioneer Bancorp vs. Home Federal Bancorp | Pioneer Bancorp vs. Lake Shore Bancorp | Pioneer Bancorp vs. Community West Bancshares | Pioneer Bancorp vs. Magyar 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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