Correlation Between Columbia Banking and Glacier Bancorp

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

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

Diversification Opportunities for Columbia Banking and Glacier Bancorp

0.82

Correlation Coefficient

Columbia Banking  Glacier Bancorp

Very poor diversification

The 3 months correlation between Columbia and Glacier is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Banking System and Glacier Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glacier Bancorp and Columbia Banking 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 Columbia Banking System are associated (or correlated) with Glacier Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glacier Bancorp has no effect on the direction of Columbia Banking i.e., Columbia Banking and Glacier Bancorp go up and down completely randomly.

Pair Corralation between Columbia Banking and Glacier Bancorp

Given the investment horizon of 90 days Columbia Banking is expected to generate 2.04 times less return on investment than Glacier Bancorp. In addition to that, Columbia Banking is 1.11 times more volatile than Glacier Bancorp. It trades about 0.02 of its total potential returns per unit of risk. Glacier Bancorp is currently generating about 0.05 per unit of volatility. If you would invest  4,080  in Glacier Bancorp on May 6, 2025 and sell it today you would earn a total of  206.00  from holding Glacier Bancorp or generate 5.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Columbia Banking System  vs.  Glacier Bancorp

Columbia Banking System

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Columbia Banking System are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong essential indicators, Columbia Banking is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Glacier Bancorp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Glacier Bancorp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, Glacier Bancorp is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Columbia Banking and Glacier Bancorp

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

The idea behind Columbia Banking System and Glacier 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.