Correlation Between Village Bank and VersaBank
Can any of the company-specific risk be diversified away by investing in both Village Bank and VersaBank 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 Village Bank and VersaBank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Village Bank and and VersaBank, you can compare the effects of market volatilities on Village Bank and VersaBank 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 Village Bank with a short position of VersaBank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Village Bank and VersaBank.
Diversification Opportunities for Village Bank and VersaBank
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Village and VersaBank is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Village Bank and and VersaBank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VersaBank and Village 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 Village Bank and are associated (or correlated) with VersaBank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VersaBank has no effect on the direction of Village Bank i.e., Village Bank and VersaBank go up and down completely randomly.
Pair Corralation between Village Bank and VersaBank
Given the investment horizon of 90 days Village Bank and is expected to generate 0.33 times more return on investment than VersaBank. However, Village Bank and is 3.05 times less risky than VersaBank. It trades about 0.07 of its potential returns per unit of risk. VersaBank is currently generating about -0.21 per unit of risk. If you would invest 7,750 in Village Bank and on December 2, 2024 and sell it today you would earn a total of 179.00 from holding Village Bank and or generate 2.31% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 68.85% |
Values | Daily Returns |
Village Bank and vs. VersaBank
Performance |
Timeline |
Village Bank |
VersaBank |
Village Bank and VersaBank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Village Bank and VersaBank
The main advantage of trading using opposite Village Bank and VersaBank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Village Bank position performs unexpectedly, VersaBank 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 VersaBank will offset losses from the drop in VersaBank's long position.Village Bank vs. Prime Meridian Holding | Village Bank vs. William Penn Bancorp | Village Bank vs. Pathfinder Bancorp | Village Bank vs. Magyar Bancorp |
VersaBank vs. Mountain Commerce Bancorp | VersaBank vs. American Riviera Bank | VersaBank vs. Home Federal Bancorp | VersaBank vs. Village Bank and |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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