Correlation Between Glacier Bancorp and Malaga Financial

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

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

Diversification Opportunities for Glacier Bancorp and Malaga Financial

-0.07

Correlation Coefficient

Glacier Bancorp  Malaga Financial

Good diversification

The 3 months correlation between Glacier and Malaga is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Glacier Bancorp and Malaga Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malaga Financial and Glacier Bancorp 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 Glacier Bancorp are associated (or correlated) with Malaga Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malaga Financial has no effect on the direction of Glacier Bancorp i.e., Glacier Bancorp and Malaga Financial go up and down completely randomly.

Pair Corralation between Glacier Bancorp and Malaga Financial

Given the investment horizon of 90 days Glacier Bancorp is expected to generate 1.01 times more return on investment than Malaga Financial. However, Glacier Bancorp is 1.01 times more volatile than Malaga Financial. It trades about 0.08 of its potential returns per unit of risk. Malaga Financial is currently generating about 0.04 per unit of risk. If you would invest  4,483  in Glacier Bancorp on October 5, 2024 and sell it today you would earn a total of  483.00  from holding Glacier Bancorp or generate 10.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Glacier Bancorp  vs.  Malaga Financial

Glacier Bancorp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Glacier Bancorp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile fundamental indicators, Glacier Bancorp may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Malaga Financial

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Malaga Financial are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Malaga Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Glacier Bancorp and Malaga Financial

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

The idea behind Glacier Bancorp and Malaga 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.