Correlation Between Pioneer Bancorp and Main Street
Can any of the company-specific risk be diversified away by investing in both Pioneer Bancorp and Main Street 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 Pioneer Bancorp and Main Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pioneer Bancorp and Main Street Financial, you can compare the effects of market volatilities on Pioneer Bancorp and Main Street 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 Pioneer Bancorp with a short position of Main Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pioneer Bancorp and Main Street.
Diversification Opportunities for Pioneer Bancorp and Main Street
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pioneer and Main is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Pioneer Bancorp and Main Street Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Main Street Financial and Pioneer 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 Pioneer Bancorp are associated (or correlated) with Main Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Main Street Financial has no effect on the direction of Pioneer Bancorp i.e., Pioneer Bancorp and Main Street go up and down completely randomly.
Pair Corralation between Pioneer Bancorp and Main Street
Given the investment horizon of 90 days Pioneer Bancorp is expected to generate 0.81 times more return on investment than Main Street. However, Pioneer Bancorp is 1.23 times less risky than Main Street. It trades about 0.09 of its potential returns per unit of risk. Main Street Financial is currently generating about -0.03 per unit of risk. If you would invest 1,007 in Pioneer Bancorp on August 28, 2024 and sell it today you would earn a total of 178.00 from holding Pioneer Bancorp or generate 17.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pioneer Bancorp vs. Main Street Financial
Performance |
| Timeline |
| Pioneer Bancorp |
| Main Street Financial |
Pioneer Bancorp and Main Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pioneer Bancorp and Main Street
The main advantage of trading using opposite Pioneer Bancorp and Main Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pioneer Bancorp position performs unexpectedly, Main Street 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 Main Street will offset losses from the drop in Main Street's long position.| 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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