Correlation Between Solvay Bank and Sturgis Bancorp
Can any of the company-specific risk be diversified away by investing in both Solvay Bank and Sturgis 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 Solvay Bank and Sturgis Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solvay Bank Corp and Sturgis Bancorp, you can compare the effects of market volatilities on Solvay Bank and Sturgis 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 Solvay Bank with a short position of Sturgis Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solvay Bank and Sturgis Bancorp.
Diversification Opportunities for Solvay Bank and Sturgis Bancorp
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Solvay and Sturgis is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Solvay Bank Corp and Sturgis Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sturgis Bancorp and Solvay 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 Solvay Bank Corp are associated (or correlated) with Sturgis Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sturgis Bancorp has no effect on the direction of Solvay Bank i.e., Solvay Bank and Sturgis Bancorp go up and down completely randomly.
Pair Corralation between Solvay Bank and Sturgis Bancorp
If you would invest 2,000 in Sturgis Bancorp on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Sturgis Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Solvay Bank Corp vs. Sturgis Bancorp
Performance |
| Timeline |
| Solvay Bank Corp |
| Sturgis Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Solvay Bank and Sturgis Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solvay Bank and Sturgis Bancorp
The main advantage of trading using opposite Solvay Bank and Sturgis Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solvay Bank position performs unexpectedly, Sturgis 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 Sturgis Bancorp will offset losses from the drop in Sturgis Bancorp's long position.| Solvay Bank vs. Invesco High Income | Solvay Bank vs. Blackrock Muniholdings Ny | Solvay Bank vs. Nuveen California Select | Solvay Bank vs. MFS Investment Grade |
| Sturgis Bancorp vs. FS Bancorp | Sturgis Bancorp vs. Eastern Michigan Financial | Sturgis Bancorp vs. Grand River Commerce | Sturgis Bancorp vs. Bank of Botetourt |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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