Correlation Between LINKBANCORP and Tompkins Financial

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

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

Diversification Opportunities for LINKBANCORP and Tompkins Financial

0.89

Correlation Coefficient

LINKBANCORP  Tompkins Financial

Very poor diversification

The 3 months correlation between LINKBANCORP and Tompkins is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding LINKBANCORP and Tompkins Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tompkins Financial 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 Tompkins Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tompkins Financial has no effect on the direction of LINKBANCORP i.e., LINKBANCORP and Tompkins Financial go up and down completely randomly.

Pair Corralation between LINKBANCORP and Tompkins Financial

Given the investment horizon of 90 days LINKBANCORP is expected to generate 1.88 times less return on investment than Tompkins Financial. In addition to that, LINKBANCORP is 1.06 times more volatile than Tompkins Financial. It trades about 0.06 of its total potential returns per unit of risk. Tompkins Financial is currently generating about 0.12 per unit of volatility. If you would invest  5,944  in Tompkins Financial on May 1, 2025 and sell it today you would earn a total of  813.00  from holding Tompkins Financial or generate 13.68% return on investment over 90 days.

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

LINKBANCORP  vs.  Tompkins Financial

LINKBANCORP

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in LINKBANCORP are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent forward-looking signals, LINKBANCORP may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Tompkins Financial

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tompkins Financial are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent primary indicators, Tompkins Financial reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with LINKBANCORP and Tompkins Financial

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

The idea behind LINKBANCORP and Tompkins Financial 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.