Correlation Between William Penn and Village Bank
Can any of the company-specific risk be diversified away by investing in both William Penn and Village Bank 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 William Penn and Village Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between William Penn Bancorp and Village Bank and, you can compare the effects of market volatilities on William Penn and Village Bank 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 William Penn with a short position of Village Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of William Penn and Village Bank.
Diversification Opportunities for William Penn and Village Bank
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between William and Village is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding William Penn Bancorp and Village Bank and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Village Bank and William Penn 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 William Penn Bancorp are associated (or correlated) with Village Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Village Bank has no effect on the direction of William Penn i.e., William Penn and Village Bank go up and down completely randomly.
Pair Corralation between William Penn and Village Bank
Given the investment horizon of 90 days William Penn Bancorp is expected to generate 2.83 times more return on investment than Village Bank. However, William Penn is 2.83 times more volatile than Village Bank and. It trades about 0.17 of its potential returns per unit of risk. Village Bank and is currently generating about 0.28 per unit of risk. If you would invest 1,232 in William Penn Bancorp on August 24, 2024 and sell it today you would earn a total of 70.00 from holding William Penn Bancorp or generate 5.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 73.91% |
| Values | Daily Returns |
William Penn Bancorp vs. Village Bank and
Performance |
| Timeline |
| William Penn Bancorp |
| Village Bank |
William Penn and Village Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with William Penn and Village Bank
The main advantage of trading using opposite William Penn and Village Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if William Penn position performs unexpectedly, Village Bank 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 Village Bank will offset losses from the drop in Village Bank's long position.| William Penn vs. Home Federal Bancorp | William Penn vs. First Financial Northwest | William Penn vs. First Northwest Bancorp | William Penn vs. First Capital |
| Village Bank vs. Prime Meridian Holding | Village Bank vs. William Penn Bancorp | Village Bank vs. Pathfinder Bancorp | Village Bank vs. Magyar 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |