Correlation Between Susquehanna Community and PT Bank
Can any of the company-specific risk be diversified away by investing in both Susquehanna Community and PT Bank 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 PT Bank 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 PT Bank Rakyat, you can compare the effects of market volatilities on Susquehanna Community and PT Bank 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 PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Susquehanna Community and PT Bank.
Diversification Opportunities for Susquehanna Community and PT Bank
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Susquehanna and BKRKF is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Susquehanna Community Financia and PT Bank Rakyat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Rakyat 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 PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Rakyat has no effect on the direction of Susquehanna Community i.e., Susquehanna Community and PT Bank go up and down completely randomly.
Pair Corralation between Susquehanna Community and PT Bank
Given the investment horizon of 90 days Susquehanna Community Financial is expected to generate 0.06 times more return on investment than PT Bank. However, Susquehanna Community Financial is 16.97 times less risky than PT Bank. It trades about 0.15 of its potential returns per unit of risk. PT Bank Rakyat is currently generating about -0.14 per unit of risk. If you would invest 1,230 in Susquehanna Community Financial on December 4, 2024 and sell it today you would earn a total of 14.00 from holding Susquehanna Community Financial or generate 1.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Susquehanna Community Financia vs. PT Bank Rakyat
Performance |
Timeline |
Susquehanna Community |
PT Bank Rakyat |
Susquehanna Community and PT Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Susquehanna Community and PT Bank
The main advantage of trading using opposite Susquehanna Community and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Susquehanna Community position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.Susquehanna Community vs. CCFNB Bancorp | Susquehanna Community vs. Mifflinburg Bancorp | Susquehanna Community vs. Woodlands Financial Services | Susquehanna Community vs. Penns Woods Bancorp |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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