Correlation Between Peapack Gladstone and Flushing Financial

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

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

Diversification Opportunities for Peapack Gladstone and Flushing Financial

0.54

Correlation Coefficient

Peapack Gladstone  Flushing Financial

Very weak diversification

The 3 months correlation between Peapack and Flushing is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Peapack Gladstone Financial and Flushing Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flushing Financial and Peapack Gladstone 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 Peapack Gladstone Financial are associated (or correlated) with Flushing Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flushing Financial has no effect on the direction of Peapack Gladstone i.e., Peapack Gladstone and Flushing Financial go up and down completely randomly.

Pair Corralation between Peapack Gladstone and Flushing Financial

Considering the 90-day investment horizon Peapack Gladstone is expected to generate 1.23 times less return on investment than Flushing Financial. But when comparing it to its historical volatility, Peapack Gladstone Financial is 1.19 times less risky than Flushing Financial. It trades about 0.02 of its potential returns per unit of risk. Flushing Financial is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,392  in Flushing Financial on December 2, 2024 and sell it today you would earn a total of  41.00  from holding Flushing Financial or generate 2.95% return on investment over 90 days.

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

Peapack Gladstone Financial  vs.  Flushing Financial

Peapack Gladstone

Risk-Adjusted Performance

Very Weak

Over the last 90 days Peapack Gladstone Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Flushing Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Flushing Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Peapack Gladstone and Flushing Financial

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

The idea behind Peapack Gladstone Financial and Flushing 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.