Correlation Between CIB Marine and Heartland Banccorp
Can any of the company-specific risk be diversified away by investing in both CIB Marine and Heartland Banccorp 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 CIB Marine and Heartland Banccorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIB Marine Bancshares and Heartland Banccorp, you can compare the effects of market volatilities on CIB Marine and Heartland Banccorp 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 CIB Marine with a short position of Heartland Banccorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIB Marine and Heartland Banccorp.
Diversification Opportunities for CIB Marine and Heartland Banccorp
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CIB and Heartland is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding CIB Marine Bancshares and Heartland Banccorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heartland Banccorp and CIB Marine 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 CIB Marine Bancshares are associated (or correlated) with Heartland Banccorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heartland Banccorp has no effect on the direction of CIB Marine i.e., CIB Marine and Heartland Banccorp go up and down completely randomly.
Pair Corralation between CIB Marine and Heartland Banccorp
Given the investment horizon of 90 days CIB Marine Bancshares is expected to generate 1.34 times more return on investment than Heartland Banccorp. However, CIB Marine is 1.34 times more volatile than Heartland Banccorp. It trades about 0.07 of its potential returns per unit of risk. Heartland Banccorp is currently generating about -0.04 per unit of risk. If you would invest 2,896 in CIB Marine Bancshares on December 2, 2024 and sell it today you would earn a total of 229.00 from holding CIB Marine Bancshares or generate 7.91% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 63.93% |
Values | Daily Returns |
CIB Marine Bancshares vs. Heartland Banccorp
Performance |
Timeline |
CIB Marine Bancshares |
Heartland Banccorp |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
CIB Marine and Heartland Banccorp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CIB Marine and Heartland Banccorp
The main advantage of trading using opposite CIB Marine and Heartland Banccorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIB Marine position performs unexpectedly, Heartland Banccorp 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 Heartland Banccorp will offset losses from the drop in Heartland Banccorp's long position.CIB Marine vs. U I Financial | CIB Marine vs. United Bancorporation of | CIB Marine vs. Harbor Bankshares | CIB Marine vs. Citizens Bancshares Corp |
Heartland Banccorp vs. U I Financial | Heartland Banccorp vs. CIB Marine Bancshares | Heartland Banccorp vs. Bank of San | Heartland Banccorp vs. Citizens Bancorp of |
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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