Correlation Between Apollo Bancorp and LINKBANCORP

Can any of the company-specific risk be diversified away by investing in both Apollo Bancorp and LINKBANCORP 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 Apollo Bancorp and LINKBANCORP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apollo Bancorp and LINKBANCORP, you can compare the effects of market volatilities on Apollo Bancorp and LINKBANCORP 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 Apollo Bancorp with a short position of LINKBANCORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Bancorp and LINKBANCORP.

Diversification Opportunities for Apollo Bancorp and LINKBANCORP

0.43

Correlation Coefficient

Apollo Bancorp  LINKBANCORP

Very weak diversification

The 3 months correlation between Apollo and LINKBANCORP is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Bancorp and LINKBANCORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LINKBANCORP and Apollo 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 Apollo Bancorp are associated (or correlated) with LINKBANCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LINKBANCORP has no effect on the direction of Apollo Bancorp i.e., Apollo Bancorp and LINKBANCORP go up and down completely randomly.

Pair Corralation between Apollo Bancorp and LINKBANCORP

Given the investment horizon of 90 days Apollo Bancorp is expected to under-perform the LINKBANCORP. But the pink sheet apears to be less risky and, when comparing its historical volatility, Apollo Bancorp is 2.37 times less risky than LINKBANCORP. The pink sheet trades about -0.03 of its potential returns per unit of risk. The LINKBANCORP is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  661.00  in LINKBANCORP on April 23, 2025 and sell it today you would earn a total of  89.00  from holding LINKBANCORP or generate 13.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

Apollo Bancorp  vs.  LINKBANCORP

Apollo Bancorp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apollo Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, Apollo Bancorp is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

LINKBANCORP

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in LINKBANCORP are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent forward-looking signals, LINKBANCORP sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Apollo Bancorp and LINKBANCORP

The main advantage of trading using opposite Apollo Bancorp and LINKBANCORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Bancorp position performs unexpectedly, LINKBANCORP 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 LINKBANCORP will offset losses from the drop in LINKBANCORP's long position.

The idea behind Apollo Bancorp and LINKBANCORP 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.