Correlation Between Southern Missouri and IF Bancorp
Can any of the company-specific risk be diversified away by investing in both Southern Missouri and IF 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 Southern Missouri and IF Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southern Missouri Bancorp and IF Bancorp, you can compare the effects of market volatilities on Southern Missouri and IF 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 Southern Missouri with a short position of IF Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Missouri and IF Bancorp.
Diversification Opportunities for Southern Missouri and IF Bancorp
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Southern and IROQ is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Southern Missouri Bancorp and IF Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IF Bancorp and Southern Missouri 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 Southern Missouri Bancorp are associated (or correlated) with IF Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IF Bancorp has no effect on the direction of Southern Missouri i.e., Southern Missouri and IF Bancorp go up and down completely randomly.
Pair Corralation between Southern Missouri and IF Bancorp
Given the investment horizon of 90 days Southern Missouri Bancorp is expected to generate 0.73 times more return on investment than IF Bancorp. However, Southern Missouri Bancorp is 1.36 times less risky than IF Bancorp. It trades about 0.23 of its potential returns per unit of risk. IF Bancorp is currently generating about -0.02 per unit of risk. If you would invest 5,620 in Southern Missouri Bancorp on November 18, 2024 and sell it today you would earn a total of 388.00 from holding Southern Missouri Bancorp or generate 6.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southern Missouri Bancorp vs. IF Bancorp
Performance |
| Timeline |
| Southern Missouri Bancorp |
| IF Bancorp |
Southern Missouri and IF Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southern Missouri and IF Bancorp
The main advantage of trading using opposite Southern Missouri and IF Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Missouri position performs unexpectedly, IF 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 IF Bancorp will offset losses from the drop in IF Bancorp's long position.| Southern Missouri vs. Commerzbank AG | Southern Missouri vs. Investar Holding Corp | Southern Missouri vs. Colony Bankcorp | Southern Missouri vs. Western New England |
| IF Bancorp vs. Home Bancorp | IF Bancorp vs. Commerzbank AG PK | IF Bancorp vs. ConnectOne Bancorp | IF Bancorp vs. Home Federal 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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