Correlation Between Sturgis Bancorp and Mifflinburg Bancorp
Can any of the company-specific risk be diversified away by investing in both Sturgis Bancorp and Mifflinburg 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 Sturgis Bancorp and Mifflinburg Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sturgis Bancorp and Mifflinburg Bancorp, you can compare the effects of market volatilities on Sturgis Bancorp and Mifflinburg 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 Sturgis Bancorp with a short position of Mifflinburg Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sturgis Bancorp and Mifflinburg Bancorp.
Diversification Opportunities for Sturgis Bancorp and Mifflinburg Bancorp
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sturgis and Mifflinburg is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sturgis Bancorp and Mifflinburg Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mifflinburg Bancorp and Sturgis 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 Sturgis Bancorp are associated (or correlated) with Mifflinburg Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mifflinburg Bancorp has no effect on the direction of Sturgis Bancorp i.e., Sturgis Bancorp and Mifflinburg Bancorp go up and down completely randomly.
Pair Corralation between Sturgis Bancorp and Mifflinburg Bancorp
If you would invest 2,000 in Sturgis Bancorp on September 6, 2024 and sell it today you would earn a total of 0.00 from holding Sturgis Bancorp or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 4.55% |
Values | Daily Returns |
Sturgis Bancorp vs. Mifflinburg Bancorp
Performance |
Timeline |
Sturgis Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Mifflinburg Bancorp |
Sturgis Bancorp and Mifflinburg Bancorp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sturgis Bancorp and Mifflinburg Bancorp
The main advantage of trading using opposite Sturgis Bancorp and Mifflinburg Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sturgis Bancorp position performs unexpectedly, Mifflinburg 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 Mifflinburg Bancorp will offset losses from the drop in Mifflinburg Bancorp's long position.Sturgis Bancorp vs. FS Bancorp | Sturgis Bancorp vs. Eastern Michigan Financial | Sturgis Bancorp vs. Grand River Commerce | Sturgis Bancorp vs. Bank of Botetourt |
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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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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