Correlation Between Susquehanna Community and Burke Herbert

Can any of the company-specific risk be diversified away by investing in both Susquehanna Community and Burke Herbert 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 Susquehanna Community and Burke Herbert into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Susquehanna Community and Burke Herbert

-0.55

Correlation Coefficient

Susquehanna Community  Burke Herbert

Excellent diversification

The 3 months correlation between Susquehanna and Burke is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Susquehanna Community Financia and Burke Herbert Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burke Herbert Financial and Susquehanna Community 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 Susquehanna Community Financial are associated (or correlated) with Burke Herbert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burke Herbert Financial has no effect on the direction of Susquehanna Community i.e., Susquehanna Community and Burke Herbert go up and down completely randomly.

Pair Corralation between Susquehanna Community and Burke Herbert

Given the investment horizon of 90 days Susquehanna Community Financial is expected to generate 0.39 times more return on investment than Burke Herbert. However, Susquehanna Community Financial is 2.56 times less risky than Burke Herbert. It trades about 0.02 of its potential returns per unit of risk. Burke Herbert Financial is currently generating about -0.1 per unit of risk. If you would invest  1,236  in Susquehanna Community Financial on December 1, 2024 and sell it today you would earn a total of  8.00  from holding Susquehanna Community Financial or generate 0.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	93.33%
Values	Daily Returns

Susquehanna Community Financia  vs.  Burke Herbert Financial

Susquehanna Community

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Susquehanna Community Financial are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental indicators, Susquehanna Community is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Burke Herbert Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Burke Herbert Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Susquehanna Community and Burke Herbert

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

The idea behind Susquehanna Community Financial and Burke Herbert 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.