Correlation Between First Mid and Luther Burbank
Can any of the company-specific risk be diversified away by investing in both First Mid and Luther Burbank 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 First Mid and Luther Burbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Mid Illinois and Luther Burbank, you can compare the effects of market volatilities on First Mid and Luther Burbank 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 First Mid with a short position of Luther Burbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Mid and Luther Burbank.
Diversification Opportunities for First Mid and Luther Burbank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and Luther is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Mid Illinois and Luther Burbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luther Burbank and First Mid 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 First Mid Illinois are associated (or correlated) with Luther Burbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luther Burbank has no effect on the direction of First Mid i.e., First Mid and Luther Burbank go up and down completely randomly.
Pair Corralation between First Mid and Luther Burbank
If you would invest (100.00) in Luther Burbank on December 1, 2024 and sell it today you would earn a total of 100.00 from holding Luther Burbank 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 |
First Mid Illinois vs. Luther Burbank
Performance |
Timeline |
First Mid Illinois |
Luther Burbank |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
First Mid and Luther Burbank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with First Mid and Luther Burbank
The main advantage of trading using opposite First Mid and Luther Burbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Mid position performs unexpectedly, Luther Burbank 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 Luther Burbank will offset losses from the drop in Luther Burbank's long position.First Mid vs. Finward Bancorp | First Mid vs. Great Southern Bancorp | First Mid vs. Franklin Financial Services | First Mid vs. Community West Bancshares |
Luther Burbank vs. First Community | Luther Burbank vs. Community West Bancshares | Luther Burbank vs. First Financial Northwest | Luther Burbank vs. First Northwest Bancorp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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