Correlation Between Sturgis Bancorp and Commercial National
Can any of the company-specific risk be diversified away by investing in both Sturgis Bancorp and Commercial National 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 Sturgis Bancorp and Commercial National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sturgis Bancorp and Commercial National Financial, you can compare the effects of market volatilities on Sturgis Bancorp and Commercial National 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 Sturgis Bancorp with a short position of Commercial National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sturgis Bancorp and Commercial National.
Diversification Opportunities for Sturgis Bancorp and Commercial National
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sturgis and Commercial is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Sturgis Bancorp and Commercial National Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial National and Sturgis Bancorp 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 Sturgis Bancorp are associated (or correlated) with Commercial National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial National has no effect on the direction of Sturgis Bancorp i.e., Sturgis Bancorp and Commercial National go up and down completely randomly.
Pair Corralation between Sturgis Bancorp and Commercial National
If you would invest 961.00 in Commercial National Financial on November 2, 2024 and sell it today you would earn a total of 94.00 from holding Commercial National Financial or generate 9.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 2.44% |
| Values | Daily Returns |
Sturgis Bancorp vs. Commercial National Financial
Performance |
| Timeline |
| Sturgis Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Commercial National |
Sturgis Bancorp and Commercial National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sturgis Bancorp and Commercial National
The main advantage of trading using opposite Sturgis Bancorp and Commercial National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sturgis Bancorp position performs unexpectedly, Commercial National 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 Commercial National will offset losses from the drop in Commercial National's long position.| Sturgis Bancorp vs. FS Bancorp | Sturgis Bancorp vs. Eastern Michigan Financial | Sturgis Bancorp vs. Grand River Commerce | Sturgis Bancorp vs. Bank of Botetourt |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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