Correlation Between Summit Bancshares and Apollo Bancorp
Can any of the company-specific risk be diversified away by investing in both Summit Bancshares and Apollo Bancorp 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 Bancshares and Apollo Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Bancshares and Apollo Bancorp, you can compare the effects of market volatilities on Summit Bancshares and Apollo Bancorp 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 Bancshares with a short position of Apollo Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Bancshares and Apollo Bancorp.
Diversification Opportunities for Summit Bancshares and Apollo Bancorp
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Summit and Apollo is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Summit Bancshares and Apollo Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Bancorp and Summit Bancshares 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 Bancshares are associated (or correlated) with Apollo Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Bancorp has no effect on the direction of Summit Bancshares i.e., Summit Bancshares and Apollo Bancorp go up and down completely randomly.
Pair Corralation between Summit Bancshares and Apollo Bancorp
Given the investment horizon of 90 days Summit Bancshares is expected to generate 2.32 times more return on investment than Apollo Bancorp. However, Summit Bancshares is 2.32 times more volatile than Apollo Bancorp. It trades about 0.07 of its potential returns per unit of risk. Apollo Bancorp is currently generating about -0.05 per unit of risk. If you would invest 4,313 in Summit Bancshares on September 1, 2024 and sell it today you would earn a total of 74.00 from holding Summit Bancshares or generate 1.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Summit Bancshares vs. Apollo Bancorp
Performance |
| Timeline |
| Summit Bancshares |
| Apollo Bancorp |
Summit Bancshares and Apollo Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Bancshares and Apollo Bancorp
The main advantage of trading using opposite Summit Bancshares and Apollo Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Bancshares position performs unexpectedly, Apollo Bancorp 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 Apollo Bancorp will offset losses from the drop in Apollo Bancorp's long position.| Summit Bancshares vs. Piraeus Bank SA | Summit Bancshares vs. Turkiye Garanti Bankasi | Summit Bancshares vs. Delhi Bank Corp | Summit Bancshares vs. Uwharrie Capital Corp |
| Apollo Bancorp vs. Piraeus Bank SA | Apollo Bancorp vs. Turkiye Garanti Bankasi | Apollo Bancorp vs. Delhi Bank Corp | Apollo Bancorp vs. Uwharrie Capital Corp |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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