Correlation Between Summit Bank and Acco Brands
Can any of the company-specific risk be diversified away by investing in both Summit Bank and Acco Brands 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 Summit Bank and Acco Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Bank Group and Acco Brands, you can compare the effects of market volatilities on Summit Bank and Acco Brands 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 Summit Bank with a short position of Acco Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Bank and Acco Brands.
Diversification Opportunities for Summit Bank and Acco Brands
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Summit and Acco is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Summit Bank Group and Acco Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acco Brands and Summit Bank 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 Summit Bank Group are associated (or correlated) with Acco Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acco Brands has no effect on the direction of Summit Bank i.e., Summit Bank and Acco Brands go up and down completely randomly.
Pair Corralation between Summit Bank and Acco Brands
Given the investment horizon of 90 days Summit Bank Group is expected to under-perform the Acco Brands. But the pink sheet apears to be less risky and, when comparing its historical volatility, Summit Bank Group is 1.22 times less risky than Acco Brands. The pink sheet trades about -0.36 of its potential returns per unit of risk. The Acco Brands is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 529.00 in Acco Brands on October 23, 2024 and sell it today you would lose (9.00) from holding Acco Brands or give up 1.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Bank Group vs. Acco Brands
Performance |
| Timeline |
| Summit Bank Group |
| Acco Brands |
Summit Bank and Acco Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Bank and Acco Brands
The main advantage of trading using opposite Summit Bank and Acco Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Bank position performs unexpectedly, Acco Brands 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 Acco Brands will offset losses from the drop in Acco Brands' long position.| Summit Bank vs. Century Next Financial | Summit Bank vs. Triad Business Bank | Summit Bank vs. First Ottawa Bancshares | Summit Bank vs. First Community Financial |
| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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