Correlation Between Auburn National and Primis Financial

Can any of the company-specific risk be diversified away by investing in both Auburn National and Primis Financial 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 Auburn National and Primis Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Auburn National Bancorporation and Primis Financial Corp, you can compare the effects of market volatilities on Auburn National and Primis Financial 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 Auburn National with a short position of Primis Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auburn National and Primis Financial.

Diversification Opportunities for Auburn National and Primis Financial

0.61

Correlation Coefficient

Auburn National  Primis Financial

Poor diversification

The 3 months correlation between Auburn and Primis is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Auburn National Bancorp. and Primis Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Primis Financial Corp and Auburn National 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 Auburn National Bancorporation are associated (or correlated) with Primis Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Primis Financial Corp has no effect on the direction of Auburn National i.e., Auburn National and Primis Financial go up and down completely randomly.

Pair Corralation between Auburn National and Primis Financial

Given the investment horizon of 90 days Auburn National Bancorporation is expected to generate 0.98 times more return on investment than Primis Financial. However, Auburn National Bancorporation is 1.02 times less risky than Primis Financial. It trades about -0.09 of its potential returns per unit of risk. Primis Financial Corp is currently generating about -0.13 per unit of risk. If you would invest  2,426  in Auburn National Bancorporation on December 28, 2024 and sell it today you would lose (265.00) from holding Auburn National Bancorporation or give up 10.92% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.36%
Values	Daily Returns

Auburn National Bancorp.  vs.  Primis Financial Corp

Auburn National Banc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Auburn National Bancorporation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's fundamental drivers remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Primis Financial Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Primis Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Auburn National and Primis Financial

The main advantage of trading using opposite Auburn National and Primis Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auburn National position performs unexpectedly, Primis Financial 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 Primis Financial will offset losses from the drop in Primis Financial's long position.

The idea behind Auburn National Bancorporation and Primis Financial Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.