Correlation Between Cashmere Valley and Alpine Banks

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

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

Diversification Opportunities for Cashmere Valley and Alpine Banks

-0.65

Correlation Coefficient

Cashmere Valley  Alpine Banks

Excellent diversification

The 3 months correlation between Cashmere and Alpine is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Cashmere Valley Bank and Alpine Banks of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpine Banks and Cashmere Valley 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 Cashmere Valley Bank are associated (or correlated) with Alpine Banks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpine Banks has no effect on the direction of Cashmere Valley i.e., Cashmere Valley and Alpine Banks go up and down completely randomly.

Pair Corralation between Cashmere Valley and Alpine Banks

Given the investment horizon of 90 days Cashmere Valley Bank is expected to under-perform the Alpine Banks. But the otc stock apears to be less risky and, when comparing its historical volatility, Cashmere Valley Bank is 1.83 times less risky than Alpine Banks. The otc stock trades about -0.17 of its potential returns per unit of risk. The Alpine Banks of is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  3,700  in Alpine Banks of on September 1, 2025 and sell it today you would earn a total of  0.00  from holding Alpine Banks of or generate 0.0% return on investment over 90 days.

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

Cashmere Valley Bank  vs.  Alpine Banks of

Cashmere Valley Bank

Risk-Adjusted Performance

Weakest

Over the last 90 days Cashmere Valley Bank has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical indicators, Cashmere Valley is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Alpine Banks

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Alpine Banks of are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak forward indicators, Alpine Banks sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cashmere Valley and Alpine Banks

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

The idea behind Cashmere Valley Bank and Alpine Banks of 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.