Correlation Between SB Financial and Community West
Can any of the company-specific risk be diversified away by investing in both SB Financial and Community West 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 SB Financial and Community West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SB Financial Group and Community West Bancshares, you can compare the effects of market volatilities on SB Financial and Community West 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 SB Financial with a short position of Community West. Check out your portfolio center. Please also check ongoing floating volatility patterns of SB Financial and Community West.
Diversification Opportunities for SB Financial and Community West
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SBFG and Community is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SB Financial Group and Community West Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Community West Bancshares and SB 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 SB Financial Group are associated (or correlated) with Community West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Community West Bancshares has no effect on the direction of SB Financial i.e., SB Financial and Community West go up and down completely randomly.
Pair Corralation between SB Financial and Community West
Given the investment horizon of 90 days SB Financial is expected to generate 1.41 times less return on investment than Community West. In addition to that, SB Financial is 1.55 times more volatile than Community West Bancshares. It trades about 0.18 of its total potential returns per unit of risk. Community West Bancshares is currently generating about 0.39 per unit of volatility. If you would invest 1,871 in Community West Bancshares on August 30, 2024 and sell it today you would earn a total of 325.00 from holding Community West Bancshares or generate 17.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SB Financial Group vs. Community West Bancshares
Performance |
| Timeline |
| SB Financial Group |
| Community West Bancshares |
SB Financial and Community West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SB Financial and Community West
The main advantage of trading using opposite SB Financial and Community West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SB Financial position performs unexpectedly, Community West 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 Community West will offset losses from the drop in Community West's long position.| SB Financial vs. Home Federal Bancorp | SB Financial vs. Lake Shore Bancorp | SB Financial vs. National Bankshares | SB Financial vs. Sound Financial Bancorp |
| Community West vs. Home Federal Bancorp | Community West vs. Magyar Bancorp | Community West vs. First Northwest Bancorp | Community West vs. First Financial Northwest |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |