Correlation Between WTB Financial and Oregon Pacific
Can any of the company-specific risk be diversified away by investing in both WTB Financial and Oregon Pacific 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 WTB Financial and Oregon Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WTB Financial and Oregon Pacific Bancorp, you can compare the effects of market volatilities on WTB Financial and Oregon Pacific 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 WTB Financial with a short position of Oregon Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of WTB Financial and Oregon Pacific.
Diversification Opportunities for WTB Financial and Oregon Pacific
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between WTB and Oregon is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding WTB Financial and Oregon Pacific Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oregon Pacific Bancorp and WTB Financial 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 WTB Financial are associated (or correlated) with Oregon Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oregon Pacific Bancorp has no effect on the direction of WTB Financial i.e., WTB Financial and Oregon Pacific go up and down completely randomly.
Pair Corralation between WTB Financial and Oregon Pacific
Assuming the 90 days horizon WTB Financial is expected to generate 2.72 times less return on investment than Oregon Pacific. In addition to that, WTB Financial is 1.88 times more volatile than Oregon Pacific Bancorp. It trades about 0.02 of its total potential returns per unit of risk. Oregon Pacific Bancorp is currently generating about 0.11 per unit of volatility. If you would invest 570.00 in Oregon Pacific Bancorp on September 2, 2024 and sell it today you would earn a total of 220.00 from holding Oregon Pacific Bancorp or generate 38.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 89.25% |
| Values | Daily Returns |
WTB Financial vs. Oregon Pacific Bancorp
Performance |
| Timeline |
| WTB Financial |
| Oregon Pacific Bancorp |
WTB Financial and Oregon Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WTB Financial and Oregon Pacific
The main advantage of trading using opposite WTB Financial and Oregon Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WTB Financial position performs unexpectedly, Oregon Pacific 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 Oregon Pacific will offset losses from the drop in Oregon Pacific's long position.| WTB Financial vs. Pioneer Bankcorp | WTB Financial vs. Liberty Northwest Bancorp | WTB Financial vs. First Community | WTB Financial vs. Coeur dAlene Bancorp |
| Oregon Pacific vs. 1ST SUMMIT BANCORP | Oregon Pacific vs. Apollo Bancorp | Oregon Pacific vs. The Farmers Bank | Oregon Pacific vs. Old National 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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