Correlation Between Peoples Bancorp and Cadiz
Can any of the company-specific risk be diversified away by investing in both Peoples Bancorp and Cadiz 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 Peoples Bancorp and Cadiz into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peoples Bancorp of and Cadiz Inc, you can compare the effects of market volatilities on Peoples Bancorp and Cadiz 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 Peoples Bancorp with a short position of Cadiz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Bancorp and Cadiz.
Diversification Opportunities for Peoples Bancorp and Cadiz
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Peoples and Cadiz is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Peoples Bancorp of and Cadiz Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cadiz Inc and Peoples 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 Peoples Bancorp of are associated (or correlated) with Cadiz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cadiz Inc has no effect on the direction of Peoples Bancorp i.e., Peoples Bancorp and Cadiz go up and down completely randomly.
Pair Corralation between Peoples Bancorp and Cadiz
Given the investment horizon of 90 days Peoples Bancorp of is expected to under-perform the Cadiz. But the stock apears to be less risky and, when comparing its historical volatility, Peoples Bancorp of is 2.52 times less risky than Cadiz. The stock trades about -0.15 of its potential returns per unit of risk. The Cadiz Inc is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 507.00 in Cadiz Inc on November 3, 2024 and sell it today you would lose (13.00) from holding Cadiz Inc or give up 2.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Peoples Bancorp of vs. Cadiz Inc
Performance |
| Timeline |
| Peoples Bancorp |
| Cadiz Inc |
Peoples Bancorp and Cadiz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peoples Bancorp and Cadiz
The main advantage of trading using opposite Peoples Bancorp and Cadiz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Bancorp position performs unexpectedly, Cadiz 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 Cadiz will offset losses from the drop in Cadiz's long position.| Peoples Bancorp vs. Home Federal Bancorp | Peoples Bancorp vs. Investar Holding Corp | Peoples Bancorp vs. Lake Shore Bancorp | Peoples Bancorp vs. Finward Bancorp |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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