Correlation Between Victory Bancorp and Community Investors

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Victory Bancorp and Community Investors 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 Victory Bancorp and Community Investors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Victory Bancorp and Community Investors Bancorp, you can compare the effects of market volatilities on Victory Bancorp and Community Investors 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 Victory Bancorp with a short position of Community Investors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Bancorp and Community Investors.

Diversification Opportunities for Victory Bancorp and Community Investors

0.4
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Victory and Community is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding The Victory Bancorp and Community Investors Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Community Investors and Victory 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 The Victory Bancorp are associated (or correlated) with Community Investors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Community Investors has no effect on the direction of Victory Bancorp i.e., Victory Bancorp and Community Investors go up and down completely randomly.

Pair Corralation between Victory Bancorp and Community Investors

Given the investment horizon of 90 days The Victory Bancorp is expected to under-perform the Community Investors. In addition to that, Victory Bancorp is 5.41 times more volatile than Community Investors Bancorp. It trades about -0.03 of its total potential returns per unit of risk. Community Investors Bancorp is currently generating about 0.29 per unit of volatility. If you would invest  1,650  in Community Investors Bancorp on August 28, 2024 and sell it today you would earn a total of  50.00  from holding Community Investors Bancorp or generate 3.03% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy7.5%
ValuesDaily Returns

The Victory Bancorp  vs.  Community Investors Bancorp

 Performance 
       Timeline  
Victory Bancorp 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in The Victory Bancorp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Victory Bancorp may actually be approaching a critical reversion point that can send shares even higher in December 2024.
Community Investors 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Community Investors Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, Community Investors is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Victory Bancorp and Community Investors Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Victory Bancorp and Community Investors

The main advantage of trading using opposite Victory Bancorp and Community Investors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Bancorp position performs unexpectedly, Community Investors 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 Community Investors will offset losses from the drop in Community Investors' long position.
The idea behind The Victory Bancorp and Community Investors Bancorp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

Other Complementary Tools

Sign In To Macroaxis
Sign in to explore Macroaxis' wealth optimization platform and fintech modules
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
AI Portfolio Architect
Use AI to generate optimal portfolios and find profitable investment opportunities
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format