Correlation Between LINKBANCORP and Capital Bancorp

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

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

Diversification Opportunities for LINKBANCORP and Capital Bancorp

0.76

Correlation Coefficient

LINKBANCORP  Capital Bancorp

Poor diversification

The 3 months correlation between LINKBANCORP and Capital is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding LINKBANCORP and Capital Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Bancorp and LINKBANCORP 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 LINKBANCORP are associated (or correlated) with Capital Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Bancorp has no effect on the direction of LINKBANCORP i.e., LINKBANCORP and Capital Bancorp go up and down completely randomly.

Pair Corralation between LINKBANCORP and Capital Bancorp

Given the investment horizon of 90 days LINKBANCORP is expected to generate 0.93 times more return on investment than Capital Bancorp. However, LINKBANCORP is 1.08 times less risky than Capital Bancorp. It trades about -0.04 of its potential returns per unit of risk. Capital Bancorp is currently generating about -0.13 per unit of risk. If you would invest  742.00  in LINKBANCORP on July 10, 2025 and sell it today you would lose (38.00) from holding LINKBANCORP or give up 5.12% of portfolio value over 90 days.

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

LINKBANCORP  vs.  Capital Bancorp

LINKBANCORP

Risk-Adjusted Performance

Weakest

Over the last 90 days LINKBANCORP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward-looking signals, LINKBANCORP is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Capital Bancorp

Risk-Adjusted Performance

Weakest

Over the last 90 days Capital Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in November 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with LINKBANCORP and Capital Bancorp

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

The idea behind LINKBANCORP and Capital 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.