Correlation Between WVS Financial and 1ST SUMMIT

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Can any of the company-specific risk be diversified away by investing in both WVS Financial and 1ST SUMMIT 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 WVS Financial and 1ST SUMMIT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WVS Financial Corp and 1ST SUMMIT BANCORP, you can compare the effects of market volatilities on WVS Financial and 1ST SUMMIT 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 WVS Financial with a short position of 1ST SUMMIT. Check out your portfolio center. Please also check ongoing floating volatility patterns of WVS Financial and 1ST SUMMIT.

Diversification Opportunities for WVS Financial and 1ST SUMMIT

0.11
  Correlation Coefficient

Average diversification

The 3 months correlation between WVS and 1ST is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding WVS Financial Corp and 1ST SUMMIT BANCORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1ST SUMMIT BANCORP and WVS Financial 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 WVS Financial Corp are associated (or correlated) with 1ST SUMMIT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1ST SUMMIT BANCORP has no effect on the direction of WVS Financial i.e., WVS Financial and 1ST SUMMIT go up and down completely randomly.

Pair Corralation between WVS Financial and 1ST SUMMIT

If you would invest  2,610  in 1ST SUMMIT BANCORP on September 3, 2024 and sell it today you would earn a total of  165.00  from holding 1ST SUMMIT BANCORP or generate 6.32% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy1.56%
ValuesDaily Returns

WVS Financial Corp  vs.  1ST SUMMIT BANCORP

 Performance 
       Timeline  
WVS Financial Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days WVS Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, WVS Financial is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
1ST SUMMIT BANCORP 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in 1ST SUMMIT BANCORP are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating primary indicators, 1ST SUMMIT may actually be approaching a critical reversion point that can send shares even higher in January 2025.

WVS Financial and 1ST SUMMIT Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with WVS Financial and 1ST SUMMIT

The main advantage of trading using opposite WVS Financial and 1ST SUMMIT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WVS Financial position performs unexpectedly, 1ST SUMMIT 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 1ST SUMMIT will offset losses from the drop in 1ST SUMMIT's long position.
The idea behind WVS Financial Corp and 1ST SUMMIT 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.
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.

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