Correlation Between Coastal Financial and Ffbw
Can any of the company-specific risk be diversified away by investing in both Coastal Financial and Ffbw 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 Coastal Financial and Ffbw into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coastal Financial Corp and Ffbw Inc, you can compare the effects of market volatilities on Coastal Financial and Ffbw 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 Coastal Financial with a short position of Ffbw. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coastal Financial and Ffbw.
Diversification Opportunities for Coastal Financial and Ffbw
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Coastal and Ffbw is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Coastal Financial Corp and Ffbw Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ffbw Inc and Coastal 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 Coastal Financial Corp are associated (or correlated) with Ffbw. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ffbw Inc has no effect on the direction of Coastal Financial i.e., Coastal Financial and Ffbw go up and down completely randomly.
Pair Corralation between Coastal Financial and Ffbw
If you would invest 3,705 in Coastal Financial Corp on January 23, 2024 and sell it today you would earn a total of 220.00 from holding Coastal Financial Corp or generate 5.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Coastal Financial Corp vs. Ffbw Inc
Performance |
| Timeline |
| Coastal Financial Corp |
| Ffbw Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Coastal Financial and Ffbw Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coastal Financial and Ffbw
The main advantage of trading using opposite Coastal Financial and Ffbw positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coastal Financial position performs unexpectedly, Ffbw 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 Ffbw will offset losses from the drop in Ffbw's long position.| Coastal Financial vs. HMN Financial | Coastal Financial vs. Lake Shore Bancorp | Coastal Financial vs. Rhinebeck Bancorp |
| Ffbw vs. Nmb Financial Corp | Ffbw vs. Hang Seng Bank | Ffbw vs. Southern BancShares NC | Ffbw vs. CCSB Financial Corp |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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