Correlation Between Partners Bancorp and Home Federal
Can any of the company-specific risk be diversified away by investing in both Partners Bancorp and Home Federal 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 Partners Bancorp and Home Federal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Partners Bancorp and Home Federal Bancorp, you can compare the effects of market volatilities on Partners Bancorp and Home Federal 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 Partners Bancorp with a short position of Home Federal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Partners Bancorp and Home Federal.
Diversification Opportunities for Partners Bancorp and Home Federal
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Partners and Home is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Partners Bancorp and Home Federal Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Federal Bancorp and Partners 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 Partners Bancorp are associated (or correlated) with Home Federal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Federal Bancorp has no effect on the direction of Partners Bancorp i.e., Partners Bancorp and Home Federal go up and down completely randomly.
Pair Corralation between Partners Bancorp and Home Federal
If you would invest 1,261 in Home Federal Bancorp on November 3, 2024 and sell it today you would earn a total of 9.00 from holding Home Federal Bancorp or generate 0.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.88% |
| Values | Daily Returns |
Partners Bancorp vs. Home Federal Bancorp
Performance |
| Timeline |
| Partners Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Home Federal Bancorp |
Partners Bancorp and Home Federal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Partners Bancorp and Home Federal
The main advantage of trading using opposite Partners Bancorp and Home Federal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Partners Bancorp position performs unexpectedly, Home Federal 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 Home Federal will offset losses from the drop in Home Federal's long position.| Partners Bancorp vs. Home Federal Bancorp | Partners Bancorp vs. Magyar Bancorp | Partners Bancorp vs. Community West Bancshares | Partners Bancorp vs. Lake Shore 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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