Correlation Between MVB Financial and Peak Bancorp

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

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

Diversification Opportunities for MVB Financial and Peak Bancorp

-0.73

Correlation Coefficient

MVB Financial  Peak Bancorp

Pay attention - limited upside

The 3 months correlation between MVB and Peak is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding MVB Financial Corp and Peak Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peak Bancorp and MVB 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 MVB Financial Corp are associated (or correlated) with Peak Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peak Bancorp has no effect on the direction of MVB Financial i.e., MVB Financial and Peak Bancorp go up and down completely randomly.

Pair Corralation between MVB Financial and Peak Bancorp

If you would invest  2,004  in MVB Financial Corp on September 13, 2024 and sell it today you would earn a total of  171.00  from holding MVB Financial Corp or generate 8.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	1.59%
Values	Daily Returns

MVB Financial Corp  vs.  Peak Bancorp

MVB Financial Corp

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MVB Financial Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady fundamental drivers, MVB Financial may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Peak Bancorp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Peak Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Peak Bancorp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with MVB Financial and Peak Bancorp

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

The idea behind MVB Financial Corp and Peak 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.