Correlation Between Equity Bancshares, and Tompkins Financial

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

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

Diversification Opportunities for Equity Bancshares, and Tompkins Financial

0.92

Correlation Coefficient

Equity Bancshares,  Tompkins Financial

Almost no diversification

The 3 months correlation between Equity and Tompkins is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Equity Bancshares, and Tompkins Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tompkins Financial and Equity Bancshares, 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 Equity Bancshares, are associated (or correlated) with Tompkins Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tompkins Financial has no effect on the direction of Equity Bancshares, i.e., Equity Bancshares, and Tompkins Financial go up and down completely randomly.

Pair Corralation between Equity Bancshares, and Tompkins Financial

Given the investment horizon of 90 days Equity Bancshares, is expected to generate 0.94 times more return on investment than Tompkins Financial. However, Equity Bancshares, is 1.06 times less risky than Tompkins Financial. It trades about -0.4 of its potential returns per unit of risk. Tompkins Financial is currently generating about -0.38 per unit of risk. If you would invest  4,375  in Equity Bancshares, on December 10, 2024 and sell it today you would lose (496.00) from holding Equity Bancshares, or give up 11.34% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Equity Bancshares,  vs.  Tompkins Financial

Equity Bancshares,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Equity Bancshares, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Tompkins Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tompkins Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's primary indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Equity Bancshares, and Tompkins Financial

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

The idea behind Equity Bancshares, and Tompkins 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.

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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 CEOs Directory module to screen CEOs from public companies around the world.