Correlation Between First Community and Ambase Corp

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

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

Diversification Opportunities for First Community and Ambase Corp

-0.43

Correlation Coefficient

First Community  Ambase Corp

Very good diversification

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

Pair Corralation between First Community and Ambase Corp

If you would invest  1,285  in First Community on August 3, 2025 and sell it today you would earn a total of  0.00  from holding First Community or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	9.09%
Values	Daily Returns

First Community  vs.  Ambase Corp

First Community

Risk-Adjusted Performance

Solid

Over the last 90 days First Community has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, First Community is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Ambase Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Ambase Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest fragile performance, the Stock's fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with First Community and Ambase Corp

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

The idea behind First Community and Ambase Corp 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 Commodity Directory module to find actively traded commodities issued by global exchanges.