Correlation Between Enterprise Financial and Lakeland Bancorp

Can any of the company-specific risk be diversified away by investing in both Enterprise Financial and Lakeland Bancorp 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 Enterprise Financial and Lakeland Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Enterprise Financial and Lakeland Bancorp

0.0

Correlation Coefficient

Enterprise Financial  Lakeland Bancorp

Pay attention - limited upside

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

Pair Corralation between Enterprise Financial and Lakeland Bancorp

If you would invest (100.00) in Lakeland Bancorp on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Lakeland Bancorp 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

Enterprise Financial Services  vs.  Lakeland Bancorp

Enterprise Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Enterprise Financial Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Enterprise Financial is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Lakeland Bancorp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lakeland Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Lakeland Bancorp is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Enterprise Financial and Lakeland Bancorp

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

The idea behind Enterprise Financial Services and Lakeland 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.

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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.