Correlation Between Pioneer Bankcorp and First Financial
Can any of the company-specific risk be diversified away by investing in both Pioneer Bankcorp and First Financial 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 Bankcorp and First Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pioneer Bankcorp and First Financial Bankshares, you can compare the effects of market volatilities on Pioneer Bankcorp and First Financial 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 Bankcorp with a short position of First Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pioneer Bankcorp and First Financial.
Diversification Opportunities for Pioneer Bankcorp and First Financial
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pioneer and First is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Pioneer Bankcorp and First Financial Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Financial Bank and Pioneer Bankcorp 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 Bankcorp are associated (or correlated) with First Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Financial Bank has no effect on the direction of Pioneer Bankcorp i.e., Pioneer Bankcorp and First Financial go up and down completely randomly.
Pair Corralation between Pioneer Bankcorp and First Financial
Given the investment horizon of 90 days Pioneer Bankcorp is expected to generate 0.47 times more return on investment than First Financial. However, Pioneer Bankcorp is 2.13 times less risky than First Financial. It trades about 0.05 of its potential returns per unit of risk. First Financial Bankshares is currently generating about 0.02 per unit of risk. If you would invest 4,014 in Pioneer Bankcorp on October 7, 2024 and sell it today you would earn a total of 986.00 from holding Pioneer Bankcorp or generate 24.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Pioneer Bankcorp vs. First Financial Bankshares
Performance |
| Timeline |
| Pioneer Bankcorp |
| First Financial Bank |
Pioneer Bankcorp and First Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pioneer Bankcorp and First Financial
The main advantage of trading using opposite Pioneer Bankcorp and First Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pioneer Bankcorp position performs unexpectedly, First Financial 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 First Financial will offset losses from the drop in First Financial's long position.| Pioneer Bankcorp vs. FineMark Holdings | Pioneer Bankcorp vs. Oxford Bank | Pioneer Bankcorp vs. Prime Meridian Holding | Pioneer Bankcorp vs. Oconee Financial |
| First Financial vs. BOK Financial | First Financial vs. Auburn National Bancorporation | First Financial vs. Great Southern Bancorp | First Financial vs. First Guaranty Bancshares |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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