Correlation Between Finward Bancorp and HV Bancorp

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Finward Bancorp and HV Bancorp 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 Finward Bancorp and HV Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finward Bancorp and HV Bancorp, you can compare the effects of market volatilities on Finward Bancorp and HV Bancorp 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 Finward Bancorp with a short position of HV Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finward Bancorp and HV Bancorp.

Diversification Opportunities for Finward Bancorp and HV Bancorp

0.34
  Correlation Coefficient

Weak diversification

The 3 months correlation between Finward and HVBC is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Finward Bancorp and HV Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HV Bancorp and Finward Bancorp 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 Finward Bancorp are associated (or correlated) with HV Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HV Bancorp has no effect on the direction of Finward Bancorp i.e., Finward Bancorp and HV Bancorp go up and down completely randomly.

Pair Corralation between Finward Bancorp and HV Bancorp

Given the investment horizon of 90 days Finward Bancorp is expected to generate 26.37 times less return on investment than HV Bancorp. But when comparing it to its historical volatility, Finward Bancorp is 1.04 times less risky than HV Bancorp. It trades about 0.0 of its potential returns per unit of risk. HV Bancorp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  2,718  in HV Bancorp on September 6, 2024 and sell it today you would earn a total of  742.00  from holding HV Bancorp or generate 27.3% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy25.45%
ValuesDaily Returns

Finward Bancorp  vs.  HV Bancorp

 Performance 
       Timeline  
Finward Bancorp 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Finward Bancorp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Finward Bancorp exhibited solid returns over the last few months and may actually be approaching a breakup point.
HV Bancorp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days HV Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental drivers, HV Bancorp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Finward Bancorp and HV Bancorp Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Finward Bancorp and HV Bancorp

The main advantage of trading using opposite Finward Bancorp and HV Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finward Bancorp position performs unexpectedly, HV Bancorp 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 HV Bancorp will offset losses from the drop in HV Bancorp's long position.
The idea behind Finward Bancorp and HV Bancorp 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.
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

Other Complementary Tools

Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope