Correlation Between Bank of Utica and Communities First

Can any of the company-specific risk be diversified away by investing in both Bank of Utica and Communities First 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 Bank of Utica and Communities First into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bank of Utica and Communities First Financial, you can compare the effects of market volatilities on Bank of Utica and Communities First 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 Bank of Utica with a short position of Communities First. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Utica and Communities First.

Diversification Opportunities for Bank of Utica and Communities First

0.0

Correlation Coefficient

Bank of Utica  Communities First

Pay attention - limited upside

The 3 months correlation between Bank and Communities is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Utica and Communities First Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Communities First and Bank of Utica 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 Bank of Utica are associated (or correlated) with Communities First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Communities First has no effect on the direction of Bank of Utica i.e., Bank of Utica and Communities First go up and down completely randomly.

Pair Corralation between Bank of Utica and Communities First

If you would invest (100.00) in Communities First Financial on December 1, 2024 and sell it today you would earn a total of  100.00  from holding Communities First Financial or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Bank of Utica  vs.  Communities First Financial

Bank of Utica

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bank of Utica has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Communities First

Risk-Adjusted Performance

Very Weak

Over the last 90 days Communities First Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Communities First is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Bank of Utica and Communities First

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

The idea behind Bank of Utica and Communities First Financial 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.