Correlation Between Oconee Financial and Harbor Bankshares
Can any of the company-specific risk be diversified away by investing in both Oconee Financial and Harbor Bankshares 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 Financial and Harbor Bankshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oconee Financial and Harbor Bankshares, you can compare the effects of market volatilities on Oconee Financial and Harbor Bankshares 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 Financial with a short position of Harbor Bankshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oconee Financial and Harbor Bankshares.
Diversification Opportunities for Oconee Financial and Harbor Bankshares
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Oconee and Harbor is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Oconee Financial and Harbor Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Bankshares and Oconee Financial 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 Financial are associated (or correlated) with Harbor Bankshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Bankshares has no effect on the direction of Oconee Financial i.e., Oconee Financial and Harbor Bankshares go up and down completely randomly.
Pair Corralation between Oconee Financial and Harbor Bankshares
Given the investment horizon of 90 days Oconee Financial is expected to generate 11.52 times less return on investment than Harbor Bankshares. But when comparing it to its historical volatility, Oconee Financial is 13.9 times less risky than Harbor Bankshares. It trades about 0.31 of its potential returns per unit of risk. Harbor Bankshares is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,215 in Harbor Bankshares on August 30, 2024 and sell it today you would earn a total of 185.00 from holding Harbor Bankshares or generate 15.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oconee Financial vs. Harbor Bankshares
Performance |
| Timeline |
| Oconee Financial |
| Harbor Bankshares |
Oconee Financial and Harbor Bankshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oconee Financial and Harbor Bankshares
The main advantage of trading using opposite Oconee Financial and Harbor Bankshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oconee Financial position performs unexpectedly, Harbor Bankshares 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 Harbor Bankshares will offset losses from the drop in Harbor Bankshares' long position.| Oconee Financial vs. Pioneer Bankcorp | Oconee Financial vs. Liberty Northwest Bancorp | Oconee Financial vs. First Community | Oconee Financial vs. Coeur dAlene Bancorp |
| Harbor Bankshares vs. MNB Holdings Corp | Harbor Bankshares vs. Oconee Financial | Harbor Bankshares vs. Mission Valley Bancorp | Harbor Bankshares vs. Merchants Marine 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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