Correlation Between 1ST SUMMIT and Bank of Utica

Can any of the company-specific risk be diversified away by investing in both 1ST SUMMIT and Bank of Utica 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 1ST SUMMIT and Bank of Utica into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 1ST SUMMIT BANCORP and Bank of Utica, you can compare the effects of market volatilities on 1ST SUMMIT and Bank of Utica 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 1ST SUMMIT with a short position of Bank of Utica. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1ST SUMMIT and Bank of Utica.

Diversification Opportunities for 1ST SUMMIT and Bank of Utica

-0.32

Correlation Coefficient

1ST SUMMIT  Bank of Utica

Very good diversification

The 3 months correlation between 1ST and Bank is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding 1ST SUMMIT BANCORP and Bank of Utica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Utica and 1ST SUMMIT 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 1ST SUMMIT BANCORP are associated (or correlated) with Bank of Utica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Utica has no effect on the direction of 1ST SUMMIT i.e., 1ST SUMMIT and Bank of Utica go up and down completely randomly.

Pair Corralation between 1ST SUMMIT and Bank of Utica

Given the investment horizon of 90 days 1ST SUMMIT BANCORP is expected to under-perform the Bank of Utica. But the pink sheet apears to be less risky and, when comparing its historical volatility, 1ST SUMMIT BANCORP is 1.19 times less risky than Bank of Utica. The pink sheet trades about -0.11 of its potential returns per unit of risk. The Bank of Utica is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  49,613  in Bank of Utica on December 2, 2024 and sell it today you would lose (4,407) from holding Bank of Utica or give up 8.88% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	70.49%
Values	Daily Returns

1ST SUMMIT BANCORP  vs.  Bank of Utica

1ST SUMMIT BANCORP

Risk-Adjusted Performance

Very Weak

Over the last 90 days 1ST SUMMIT BANCORP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's primary indicators 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.

Bank of Utica

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bank of Utica has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with 1ST SUMMIT and Bank of Utica

The main advantage of trading using opposite 1ST SUMMIT and Bank of Utica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1ST SUMMIT position performs unexpectedly, Bank of Utica 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 Bank of Utica will offset losses from the drop in Bank of Utica's long position.

The idea behind 1ST SUMMIT BANCORP and Bank of Utica 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.