Correlation Between LINKBANCORP and Pinnacle Bancshares

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

By analyzing existing cross correlation between LINKBANCORP and Pinnacle Bancshares, you can compare the effects of market volatilities on LINKBANCORP and Pinnacle Bancshares 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 Pinnacle Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of LINKBANCORP and Pinnacle Bancshares.

Diversification Opportunities for LINKBANCORP and Pinnacle Bancshares

-0.42

Correlation Coefficient

LINKBANCORP  Pinnacle Bancshares

Very good diversification

The 3 months correlation between LINKBANCORP and Pinnacle is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding LINKBANCORP and Pinnacle Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinnacle Bancshares 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 Pinnacle Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinnacle Bancshares has no effect on the direction of LINKBANCORP i.e., LINKBANCORP and Pinnacle Bancshares go up and down completely randomly.

Pair Corralation between LINKBANCORP and Pinnacle Bancshares

Given the investment horizon of 90 days LINKBANCORP is expected to under-perform the Pinnacle Bancshares. In addition to that, LINKBANCORP is 3.12 times more volatile than Pinnacle Bancshares. It trades about -0.06 of its total potential returns per unit of risk. Pinnacle Bancshares is currently generating about -0.03 per unit of volatility. If you would invest  3,223  in Pinnacle Bancshares on July 8, 2025 and sell it today you would lose (18.00) from holding Pinnacle Bancshares or give up 0.56% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	50.0%
Values	Daily Returns

LINKBANCORP  vs.  Pinnacle Bancshares

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.

Pinnacle Bancshares

Risk-Adjusted Performance

Weakest

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

Pair Trading with LINKBANCORP and Pinnacle Bancshares

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

The idea behind LINKBANCORP and Pinnacle Bancshares 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.