Correlation Between OptimumBank Holdings and Inter Co
Can any of the company-specific risk be diversified away by investing in both OptimumBank Holdings and Inter Co 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 OptimumBank Holdings and Inter Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OptimumBank Holdings and Inter Co Class, you can compare the effects of market volatilities on OptimumBank Holdings and Inter Co 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 OptimumBank Holdings with a short position of Inter Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of OptimumBank Holdings and Inter Co.
Diversification Opportunities for OptimumBank Holdings and Inter Co
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OptimumBank and Inter is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding OptimumBank Holdings and Inter Co Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Co Class and OptimumBank Holdings 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 OptimumBank Holdings are associated (or correlated) with Inter Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Co Class has no effect on the direction of OptimumBank Holdings i.e., OptimumBank Holdings and Inter Co go up and down completely randomly.
Pair Corralation between OptimumBank Holdings and Inter Co
Given the investment horizon of 90 days OptimumBank Holdings is expected to generate 0.72 times more return on investment than Inter Co. However, OptimumBank Holdings is 1.39 times less risky than Inter Co. It trades about 0.08 of its potential returns per unit of risk. Inter Co Class is currently generating about -0.01 per unit of risk. If you would invest 329.00 in OptimumBank Holdings on September 14, 2024 and sell it today you would earn a total of 161.00 from holding OptimumBank Holdings or generate 48.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OptimumBank Holdings vs. Inter Co Class
Performance |
| Timeline |
| OptimumBank Holdings |
| Inter Co Class |
OptimumBank Holdings and Inter Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OptimumBank Holdings and Inter Co
The main advantage of trading using opposite OptimumBank Holdings and Inter Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OptimumBank Holdings position performs unexpectedly, Inter Co 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 Inter Co will offset losses from the drop in Inter Co's long position.| OptimumBank Holdings vs. First National Bank | OptimumBank Holdings vs. TrustCo Bank Corp | OptimumBank Holdings vs. Inter Co Class | OptimumBank Holdings vs. Rhinebeck Bancorp |
| Inter Co vs. Community West Bancshares | Inter Co vs. First Financial Northwest | Inter Co vs. First Northwest Bancorp | Inter Co vs. First Capital |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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