Correlation Between ConnectOne Bancorp and HAVN Life
Can any of the company-specific risk be diversified away by investing in both ConnectOne Bancorp and HAVN Life 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 ConnectOne Bancorp and HAVN Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ConnectOne Bancorp and HAVN Life Sciences, you can compare the effects of market volatilities on ConnectOne Bancorp and HAVN Life 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 ConnectOne Bancorp with a short position of HAVN Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of ConnectOne Bancorp and HAVN Life.
Diversification Opportunities for ConnectOne Bancorp and HAVN Life
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ConnectOne and HAVN is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding ConnectOne Bancorp and HAVN Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAVN Life Sciences and ConnectOne 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 ConnectOne Bancorp are associated (or correlated) with HAVN Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAVN Life Sciences has no effect on the direction of ConnectOne Bancorp i.e., ConnectOne Bancorp and HAVN Life go up and down completely randomly.
Pair Corralation between ConnectOne Bancorp and HAVN Life
Assuming the 90 days horizon ConnectOne Bancorp is expected to generate 90.14 times less return on investment than HAVN Life. But when comparing it to its historical volatility, ConnectOne Bancorp is 30.14 times less risky than HAVN Life. It trades about 0.03 of its potential returns per unit of risk. HAVN Life Sciences is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 6.00 in HAVN Life Sciences on September 23, 2024 and sell it today you would lose (5.48) from holding HAVN Life Sciences or give up 91.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 99.8% |
Values | Daily Returns |
ConnectOne Bancorp vs. HAVN Life Sciences
Performance |
Timeline |
ConnectOne Bancorp |
HAVN Life Sciences |
ConnectOne Bancorp and HAVN Life Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ConnectOne Bancorp and HAVN Life
The main advantage of trading using opposite ConnectOne Bancorp and HAVN Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ConnectOne Bancorp position performs unexpectedly, HAVN Life 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 HAVN Life will offset losses from the drop in HAVN Life's long position.ConnectOne Bancorp vs. Dime Community Bancshares | ConnectOne Bancorp vs. Washington Federal | ConnectOne Bancorp vs. CNB Financial | ConnectOne Bancorp vs. First Guaranty Bancshares |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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