Correlation Between Summit Bank and OFX Group
Can any of the company-specific risk be diversified away by investing in both Summit Bank and OFX Group 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 OFX Group 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 OFX Group Ltd, you can compare the effects of market volatilities on Summit Bank and OFX Group 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 OFX Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Bank and OFX Group.
Diversification Opportunities for Summit Bank and OFX Group
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Summit and OFX is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Summit Bank Group and OFX Group Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFX Group 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 OFX Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFX Group has no effect on the direction of Summit Bank i.e., Summit Bank and OFX Group go up and down completely randomly.
Pair Corralation between Summit Bank and OFX Group
If you would invest 435.00 in OFX Group Ltd on October 25, 2024 and sell it today you would earn a total of 0.00 from holding OFX Group Ltd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Bank Group vs. OFX Group Ltd
Performance |
| Timeline |
| Summit Bank Group |
| OFX Group |
Summit Bank and OFX Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Bank and OFX Group
The main advantage of trading using opposite Summit Bank and OFX Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Bank position performs unexpectedly, OFX Group 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 OFX Group will offset losses from the drop in OFX Group's long position.| Summit Bank vs. Savi Financial | Summit Bank vs. Pacific West Bancorp | Summit Bank vs. Commencement Bancorp | Summit Bank vs. Merchants Marine Bancorp |
| OFX Group vs. Ziff Davis | OFX Group vs. Weibo Corp | OFX Group vs. Tencent Music Entertainment | OFX Group vs. Molecular Partners AG |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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