Correlation Between Delhi Bank and Juniata Valley

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

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

Diversification Opportunities for Delhi Bank and Juniata Valley

0.0

Correlation Coefficient

Delhi Bank  Juniata Valley

Pay attention - limited upside

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

Pair Corralation between Delhi Bank and Juniata Valley

Given the investment horizon of 90 days Delhi Bank Corp is expected to generate 0.17 times more return on investment than Juniata Valley. However, Delhi Bank Corp is 5.82 times less risky than Juniata Valley. It trades about 0.26 of its potential returns per unit of risk. Juniata Valley Financial is currently generating about -0.11 per unit of risk. If you would invest  2,050  in Delhi Bank Corp on October 20, 2024 and sell it today you would earn a total of  25.00  from holding Delhi Bank Corp or generate 1.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	90.0%
Values	Daily Returns

Delhi Bank Corp  vs.  Juniata Valley Financial

Delhi Bank Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Delhi Bank Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Delhi Bank is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Juniata Valley Financial

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Juniata Valley Financial are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Juniata Valley may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Delhi Bank and Juniata Valley

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

The idea behind Delhi Bank Corp and Juniata Valley 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.

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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.