Correlation Between Security Bank and Prime Media

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

By analyzing existing cross correlation between Security Bank Corp and Prime Media Holdings, you can compare the effects of market volatilities on Security Bank and Prime Media 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 Security Bank with a short position of Prime Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Security Bank and Prime Media.

Diversification Opportunities for Security Bank and Prime Media

0.24

Correlation Coefficient

Security Bank  Prime Media

Modest diversification

The 3 months correlation between Security and Prime is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Security Bank Corp and Prime Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prime Media Holdings and Security Bank 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 Security Bank Corp are associated (or correlated) with Prime Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prime Media Holdings has no effect on the direction of Security Bank i.e., Security Bank and Prime Media go up and down completely randomly.

Pair Corralation between Security Bank and Prime Media

Assuming the 90 days trading horizon Security Bank Corp is expected to generate 0.83 times more return on investment than Prime Media. However, Security Bank Corp is 1.21 times less risky than Prime Media. It trades about 0.17 of its potential returns per unit of risk. Prime Media Holdings is currently generating about -0.12 per unit of risk. If you would invest  6,480  in Security Bank Corp on September 4, 2024 and sell it today you would earn a total of  2,035  from holding Security Bank Corp or generate 31.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	93.75%
Values	Daily Returns

Security Bank Corp  vs.  Prime Media Holdings

Security Bank Corp

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Security Bank Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Security Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Prime Media Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Prime Media Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Security Bank and Prime Media

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

The idea behind Security Bank Corp and Prime Media Holdings 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.