Farmers Merchants Bancorp Stock Volatility
| FMCB Stock | USD 975.00 10.00 1.04% |
We consider Farmers Merchants very steady. Farmers Merchants Bancorp secures Sharpe Ratio (or Efficiency) of 0.0059, which denotes the company had a 0.0059% return per unit of risk over the last 3 months. We have found twenty-three technical indicators for Farmers Merchants Bancorp, which you can use to evaluate the volatility of the firm. Please confirm Farmers Merchants' Standard Deviation of 1.51, mean deviation of 0.9443, and Variance of 2.28 to check if the risk estimate we provide is consistent with the expected return of 0.0071%. Key indicators related to Farmers Merchants' volatility include:
720 Days Market Risk | Chance Of Distress | 720 Days Economic Sensitivity |
Farmers Merchants OTC Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Farmers daily returns, and it is calculated using variance and standard deviation. We also use Farmers's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Farmers Merchants volatility.
Farmers |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Farmers Merchants can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Farmers Merchants at lower prices. For example, an investor can purchase Farmers stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Farmers Merchants' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving against Farmers OTC Stock
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Farmers Merchants Market Sensitivity And Downside Risk
Farmers Merchants' beta coefficient measures the volatility of Farmers otc stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Farmers otc stock's returns against your selected market. In other words, Farmers Merchants's beta of 0.63 provides an investor with an approximation of how much risk Farmers Merchants otc stock can potentially add to one of your existing portfolios. Farmers Merchants Bancorp exhibits very low volatility with skewness of -1.6 and kurtosis of 8.44. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Farmers Merchants' otc stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Farmers Merchants' otc stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Farmers Merchants Bancorp Demand TrendCheck current 90 days Farmers Merchants correlation with market (NYSE Composite)Farmers Beta |
Farmers standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 1.2 |
It is essential to understand the difference between upside risk (as represented by Farmers Merchants's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Farmers Merchants' daily returns or price. Since the actual investment returns on holding a position in farmers otc stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Farmers Merchants.
Farmers Merchants Bancorp OTC Stock Volatility Analysis
Volatility refers to the frequency at which Farmers Merchants otc price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Farmers Merchants' price changes. Investors will then calculate the volatility of Farmers Merchants' otc stock to predict their future moves. A otc that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A otc stock with relatively stable price changes has low volatility. A highly volatile otc is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Farmers Merchants' volatility:
Historical Volatility
This type of otc volatility measures Farmers Merchants' fluctuations based on previous trends. It's commonly used to predict Farmers Merchants' future behavior based on its past. However, it cannot conclusively determine the future direction of the otc stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Farmers Merchants' current market price. This means that the otc will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Farmers Merchants' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Farmers Merchants Bancorp Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Farmers Merchants Projected Return Density Against Market
Given the investment horizon of 90 days Farmers Merchants has a beta of 0.6283 . This usually indicates as returns on the market go up, Farmers Merchants average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Farmers Merchants Bancorp will be expected to be much smaller as well.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Farmers Merchants or Banks sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Farmers Merchants' price will be affected by overall otc stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Farmers otc's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Farmers Merchants Bancorp has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the NYSE Composite. Predicted Return Density |
| Returns |
What Drives a Farmers Merchants Price Volatility?
Several factors can influence a otc's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Farmers Merchants OTC Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Farmers Merchants is 16904.32. The daily returns are distributed with a variance of 1.45 and standard deviation of 1.2. The mean deviation of Farmers Merchants Bancorp is currently at 0.8. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.63
α | Alpha over NYSE Composite | -0.19 | |
β | Beta against NYSE Composite | 0.63 | |
σ | Overall volatility | 1.20 | |
Ir | Information ratio | -0.14 |
Farmers Merchants OTC Stock Return Volatility
Farmers Merchants historical daily return volatility represents how much of Farmers Merchants otc's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company inherits 1.204% risk (volatility on return distribution) over the 90 days horizon. By contrast, NYSE Composite accepts 0.6219% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Farmers Merchants Volatility
Volatility is a rate at which the price of Farmers Merchants or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Farmers Merchants may increase or decrease. In other words, similar to Farmers's beta indicator, it measures the risk of Farmers Merchants and helps estimate the fluctuations that may happen in a short period of time. So if prices of Farmers Merchants fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.Farmers Merchants Bancorp operates as the bank holding company for Farmers Merchants Bank of Central California that provides various banking services to businesses and individuals. Farmers Merchants Bancorp was founded in 1916 and is headquartered in Lodi, California. Farmers Merch operates under BanksRegional classification in the United States and is traded on OTC Exchange. It employs 373 people.
Farmers Merchants' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Farmers OTC Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Farmers Merchants' price varies over time.
3 ways to utilize Farmers Merchants' volatility to invest better
Higher Farmers Merchants' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Farmers Merchants Bancorp stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Farmers Merchants Bancorp stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Farmers Merchants Bancorp investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Farmers Merchants' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Farmers Merchants' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Farmers Merchants Investment Opportunity
Farmers Merchants Bancorp has a volatility of 1.2 and is 1.94 times more volatile than NYSE Composite. 10 percent of all equities and portfolios are less risky than Farmers Merchants. You can use Farmers Merchants Bancorp to enhance the returns of your portfolios. The otc stock experiences a large bullish trend. Check odds of Farmers Merchants to be traded at $1072.5 in 90 days.Modest diversification
The correlation between Farmers Merchants Bancorp and NYA is 0.26 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Farmers Merchants Bancorp and NYA in the same portfolio, assuming nothing else is changed.
Farmers Merchants Additional Risk Indicators
The analysis of Farmers Merchants' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Farmers Merchants' investment and either accepting that risk or mitigating it. Along with some common measures of Farmers Merchants otc stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | (0.06) | |||
| Market Risk Adjusted Performance | (0.25) | |||
| Mean Deviation | 0.9443 | |||
| Coefficient Of Variation | (993.56) | |||
| Standard Deviation | 1.51 | |||
| Variance | 2.28 | |||
| Information Ratio | (0.14) |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential otc stocks, we recommend comparing similar otcs with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Farmers Merchants Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Farmers Merchants as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Farmers Merchants' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Farmers Merchants' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Farmers Merchants Bancorp.
When determining whether Farmers Merchants Bancorp offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Farmers Merchants' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Farmers Merchants Bancorp Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Farmers Merchants Bancorp Stock: Check out Investing Opportunities to better understand how to build diversified portfolios, which includes a position in Farmers Merchants Bancorp. Also, note that the market value of any otc stock could be tightly coupled with the direction of predictive economic indicators such as signals in main economic indicators. Note that the Farmers Merchants Bancorp information on this page should be used as a complementary analysis to other Farmers Merchants' statistical models used 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Complementary Tools for Farmers OTC Stock analysis
When running Farmers Merchants' price analysis, check to measure Farmers Merchants' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Farmers Merchants is operating at the current time. Most of Farmers Merchants' value examination focuses on studying past and present price action to predict the probability of Farmers Merchants' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Farmers Merchants' price. Additionally, you may evaluate how the addition of Farmers Merchants to your portfolios can decrease your overall portfolio volatility.
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