Correlation Between Western New and Pioneer Bancorp
Can any of the company-specific risk be diversified away by investing in both Western New and Pioneer 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 Western New and Pioneer Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western New England and Pioneer Bancorp, you can compare the effects of market volatilities on Western New and Pioneer 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 Western New with a short position of Pioneer Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western New and Pioneer Bancorp.
Diversification Opportunities for Western New and Pioneer Bancorp
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Western and Pioneer is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Western New England and Pioneer Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Bancorp and Western New 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 Western New England are associated (or correlated) with Pioneer Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Bancorp has no effect on the direction of Western New i.e., Western New and Pioneer Bancorp go up and down completely randomly.
Pair Corralation between Western New and Pioneer Bancorp
Given the investment horizon of 90 days Western New is expected to generate 1.46 times less return on investment than Pioneer Bancorp. In addition to that, Western New is 1.35 times more volatile than Pioneer Bancorp. It trades about 0.09 of its total potential returns per unit of risk. Pioneer Bancorp is currently generating about 0.18 per unit of volatility. If you would invest 1,131 in Pioneer Bancorp on November 3, 2024 and sell it today you would earn a total of 48.00 from holding Pioneer Bancorp or generate 4.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western New England vs. Pioneer Bancorp
Performance |
| Timeline |
| Western New England |
| Pioneer Bancorp |
Western New and Pioneer Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western New and Pioneer Bancorp
The main advantage of trading using opposite Western New and Pioneer Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western New position performs unexpectedly, Pioneer 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 Pioneer Bancorp will offset losses from the drop in Pioneer Bancorp's long position.| Western New vs. US Bancorp | Western New vs. Truist Financial Corp | Western New vs. Fifth Third Bancorp | Western New vs. KeyCorp |
| Pioneer Bancorp vs. Home Federal Bancorp | Pioneer Bancorp vs. Lake Shore Bancorp | Pioneer Bancorp vs. Community West Bancshares | Pioneer Bancorp 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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