Correlation Between Bank Ozk and Dime Community
Can any of the company-specific risk be diversified away by investing in both Bank Ozk and Dime Community 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 Bank Ozk and Dime Community into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Ozk Preferred and Dime Community Bancshares, you can compare the effects of market volatilities on Bank Ozk and Dime Community 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 Bank Ozk with a short position of Dime Community. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Ozk and Dime Community.
Diversification Opportunities for Bank Ozk and Dime Community
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Dime is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Bank Ozk Preferred and Dime Community Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dime Community Bancshares and Bank Ozk 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 Bank Ozk Preferred are associated (or correlated) with Dime Community. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dime Community Bancshares has no effect on the direction of Bank Ozk i.e., Bank Ozk and Dime Community go up and down completely randomly.
Pair Corralation between Bank Ozk and Dime Community
Assuming the 90 days horizon Bank Ozk Preferred is expected to generate 1.16 times more return on investment than Dime Community. However, Bank Ozk is 1.16 times more volatile than Dime Community Bancshares. It trades about 0.09 of its potential returns per unit of risk. Dime Community Bancshares is currently generating about 0.09 per unit of risk. If you would invest 1,582 in Bank Ozk Preferred on December 27, 2024 and sell it today you would earn a total of 97.00 from holding Bank Ozk Preferred or generate 6.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Bank Ozk Preferred vs. Dime Community Bancshares
Performance |
Timeline |
Bank Ozk Preferred |
Dime Community Bancshares |
Bank Ozk and Dime Community Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank Ozk and Dime Community
The main advantage of trading using opposite Bank Ozk and Dime Community positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Ozk position performs unexpectedly, Dime Community 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 Dime Community will offset losses from the drop in Dime Community's long position.Bank Ozk vs. Regions Financial | Bank Ozk vs. Huntington Bancshares Incorporated | Bank Ozk vs. Texas Capital Bancshares | Bank Ozk vs. Washington Federal |
Dime Community vs. First Citizens BancShares | Dime Community vs. Fifth Third Bancorp | Dime Community vs. OceanFirst Financial Corp | Dime Community vs. Fifth Third 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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |