Correlation Between Community Bankers and Oregon Pacific

Can any of the company-specific risk be diversified away by investing in both Community Bankers and Oregon Pacific 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 Community Bankers and Oregon Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Community Bankers and Oregon Pacific Bancorp, you can compare the effects of market volatilities on Community Bankers and Oregon Pacific 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 Community Bankers with a short position of Oregon Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Community Bankers and Oregon Pacific.

Diversification Opportunities for Community Bankers and Oregon Pacific

-0.29

Correlation Coefficient

Community Bankers  Oregon Pacific

Very good diversification

The 3 months correlation between Community and Oregon is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Community Bankers and Oregon Pacific Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oregon Pacific Bancorp and Community Bankers 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 Community Bankers are associated (or correlated) with Oregon Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oregon Pacific Bancorp has no effect on the direction of Community Bankers i.e., Community Bankers and Oregon Pacific go up and down completely randomly.

Pair Corralation between Community Bankers and Oregon Pacific

Given the investment horizon of 90 days Community Bankers is expected to generate 4.35 times more return on investment than Oregon Pacific. However, Community Bankers is 4.35 times more volatile than Oregon Pacific Bancorp. It trades about 0.04 of its potential returns per unit of risk. Oregon Pacific Bancorp is currently generating about 0.01 per unit of risk. If you would invest  525.00  in Community Bankers on December 29, 2024 and sell it today you would earn a total of  25.00  from holding Community Bankers or generate 4.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Community Bankers  vs.  Oregon Pacific Bancorp

Community Bankers

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Community Bankers are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Community Bankers may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Oregon Pacific Bancorp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Oregon Pacific Bancorp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Oregon Pacific is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Community Bankers and Oregon Pacific

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

The idea behind Community Bankers and Oregon Pacific Bancorp 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.

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 Bonds Directory module to find actively traded corporate debentures issued by US companies.