Correlation Between Eagle Financial and Meridian Bancorp
Can any of the company-specific risk be diversified away by investing in both Eagle Financial and Meridian 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 Eagle Financial and Meridian Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Financial Services and Meridian Bancorp, you can compare the effects of market volatilities on Eagle Financial and Meridian 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 Eagle Financial with a short position of Meridian Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Financial and Meridian Bancorp.
Diversification Opportunities for Eagle Financial and Meridian Bancorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eagle and Meridian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Financial Services and Meridian Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meridian Bancorp and Eagle 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 Eagle Financial Services are associated (or correlated) with Meridian Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meridian Bancorp has no effect on the direction of Eagle Financial i.e., Eagle Financial and Meridian Bancorp go up and down completely randomly.
Pair Corralation between Eagle Financial and Meridian Bancorp
If you would invest (100.00) in Meridian Bancorp on December 29, 2023 and sell it today you would earn a total of 100.00 from holding Meridian Bancorp or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Eagle Financial Services vs. Meridian Bancorp
Performance |
Timeline |
Eagle Financial Services |
Meridian Bancorp |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Eagle Financial and Meridian Bancorp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eagle Financial and Meridian Bancorp
The main advantage of trading using opposite Eagle Financial and Meridian Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Financial position performs unexpectedly, Meridian 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 Meridian Bancorp will offset losses from the drop in Meridian Bancorp's long position.Eagle Financial vs. Procter Gamble | Eagle Financial vs. Ep Emerging Markets | Eagle Financial vs. Bayview Acquisition Corp | Eagle Financial vs. Sun Life Financial |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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