Correlation Between Westbury Bancorp and Glen Burnie
Can any of the company-specific risk be diversified away by investing in both Westbury Bancorp and Glen Burnie 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 Westbury Bancorp and Glen Burnie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westbury Bancorp and Glen Burnie Bancorp, you can compare the effects of market volatilities on Westbury Bancorp and Glen Burnie 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 Westbury Bancorp with a short position of Glen Burnie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westbury Bancorp and Glen Burnie.
Diversification Opportunities for Westbury Bancorp and Glen Burnie
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Westbury and Glen is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Westbury Bancorp and Glen Burnie Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glen Burnie Bancorp and Westbury 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 Westbury Bancorp are associated (or correlated) with Glen Burnie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glen Burnie Bancorp has no effect on the direction of Westbury Bancorp i.e., Westbury Bancorp and Glen Burnie go up and down completely randomly.
Pair Corralation between Westbury Bancorp and Glen Burnie
Given the investment horizon of 90 days Westbury Bancorp is expected to generate 31.18 times less return on investment than Glen Burnie. But when comparing it to its historical volatility, Westbury Bancorp is 93.97 times less risky than Glen Burnie. It trades about 0.12 of its potential returns per unit of risk. Glen Burnie Bancorp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 811.00 in Glen Burnie Bancorp on August 26, 2024 and sell it today you would lose (251.00) from holding Glen Burnie Bancorp or give up 30.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 9.05% |
| Values | Daily Returns |
Westbury Bancorp vs. Glen Burnie Bancorp
Performance |
| Timeline |
| Westbury Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Glen Burnie Bancorp |
Westbury Bancorp and Glen Burnie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westbury Bancorp and Glen Burnie
The main advantage of trading using opposite Westbury Bancorp and Glen Burnie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westbury Bancorp position performs unexpectedly, Glen Burnie 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 Glen Burnie will offset losses from the drop in Glen Burnie's long position.| Westbury Bancorp vs. Home Federal Bancorp | Westbury Bancorp vs. First Northwest Bancorp | Westbury Bancorp vs. First Community | Westbury Bancorp vs. Oak Valley Bancorp |
| Glen Burnie vs. First Bankers Trustshares | Glen Burnie vs. Greenville Federal Financial | Glen Burnie vs. First Ottawa Bancshares | Glen Burnie vs. Coastal Carolina Bancshares |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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