Correlation Between Community West and First Savings
Can any of the company-specific risk be diversified away by investing in both Community West and First Savings 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 Community West and First Savings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Community West Bancshares and First Savings Financial, you can compare the effects of market volatilities on Community West and First Savings 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 Community West with a short position of First Savings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Community West and First Savings.
Diversification Opportunities for Community West and First Savings
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Community and First is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Community West Bancshares and First Savings Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Savings Financial and Community West 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 Community West Bancshares are associated (or correlated) with First Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Savings Financial has no effect on the direction of Community West i.e., Community West and First Savings go up and down completely randomly.
Pair Corralation between Community West and First Savings
Given the investment horizon of 90 days Community West Bancshares is expected to generate 1.17 times more return on investment than First Savings. However, Community West is 1.17 times more volatile than First Savings Financial. It trades about 0.06 of its potential returns per unit of risk. First Savings Financial is currently generating about -0.07 per unit of risk. If you would invest 1,784 in Community West Bancshares on May 9, 2025 and sell it today you would earn a total of 90.00 from holding Community West Bancshares or generate 5.04% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Community West Bancshares vs. First Savings Financial
Performance |
Timeline |
Community West Bancshares |
First Savings Financial |
Community West and First Savings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Community West and First Savings
The main advantage of trading using opposite Community West and First Savings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Community West position performs unexpectedly, First Savings 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 First Savings will offset losses from the drop in First Savings' long position.Community West vs. Home Federal Bancorp | Community West vs. First Northwest Bancorp | Community West vs. First Capital | Community West vs. Citizens Community Bancorp |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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