Correlation Between CCFNB Bancorp and Pathfinder Bancorp

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

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

Diversification Opportunities for CCFNB Bancorp and Pathfinder Bancorp

0.15

Correlation Coefficient

CCFNB Bancorp  Pathfinder Bancorp

Average diversification

The 3 months correlation between CCFNB and Pathfinder is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding CCFNB Bancorp and Pathfinder Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pathfinder Bancorp and CCFNB 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 CCFNB Bancorp are associated (or correlated) with Pathfinder Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pathfinder Bancorp has no effect on the direction of CCFNB Bancorp i.e., CCFNB Bancorp and Pathfinder Bancorp go up and down completely randomly.

Pair Corralation between CCFNB Bancorp and Pathfinder Bancorp

Given the investment horizon of 90 days CCFNB Bancorp is expected to generate 0.99 times more return on investment than Pathfinder Bancorp. However, CCFNB Bancorp is 1.01 times less risky than Pathfinder Bancorp. It trades about 0.06 of its potential returns per unit of risk. Pathfinder Bancorp is currently generating about 0.02 per unit of risk. If you would invest  3,219  in CCFNB Bancorp on April 25, 2025 and sell it today you would earn a total of  1,531  from holding CCFNB Bancorp or generate 47.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	84.42%
Values	Daily Returns

CCFNB Bancorp  vs.  Pathfinder Bancorp

CCFNB Bancorp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CCFNB Bancorp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal technical and fundamental indicators, CCFNB Bancorp displayed solid returns over the last few months and may actually be approaching a breakup point.

Pathfinder Bancorp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Pathfinder Bancorp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, Pathfinder Bancorp is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with CCFNB Bancorp and Pathfinder Bancorp

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

The idea behind CCFNB Bancorp and Pathfinder 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.