Correlation Between Magyar Bancorp and Finward Bancorp
Can any of the company-specific risk be diversified away by investing in both Magyar Bancorp and Finward 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 Magyar Bancorp and Finward Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magyar Bancorp and Finward Bancorp, you can compare the effects of market volatilities on Magyar Bancorp and Finward 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 Magyar Bancorp with a short position of Finward Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magyar Bancorp and Finward Bancorp.
Diversification Opportunities for Magyar Bancorp and Finward Bancorp
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Magyar and Finward is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Magyar Bancorp and Finward Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finward Bancorp and Magyar Bancorp 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 Magyar Bancorp are associated (or correlated) with Finward Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finward Bancorp has no effect on the direction of Magyar Bancorp i.e., Magyar Bancorp and Finward Bancorp go up and down completely randomly.
Pair Corralation between Magyar Bancorp and Finward Bancorp
Given the investment horizon of 90 days Magyar Bancorp is expected to generate 0.98 times more return on investment than Finward Bancorp. However, Magyar Bancorp is 1.02 times less risky than Finward Bancorp. It trades about 0.23 of its potential returns per unit of risk. Finward Bancorp is currently generating about -0.1 per unit of risk. If you would invest 1,434 in Magyar Bancorp on May 7, 2025 and sell it today you would earn a total of 276.00 from holding Magyar Bancorp or generate 19.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 96.72% |
Values | Daily Returns |
Magyar Bancorp vs. Finward Bancorp
Performance |
Timeline |
Magyar Bancorp |
Finward Bancorp |
Magyar Bancorp and Finward Bancorp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Magyar Bancorp and Finward Bancorp
The main advantage of trading using opposite Magyar Bancorp and Finward Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magyar Bancorp position performs unexpectedly, Finward 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 Finward Bancorp will offset losses from the drop in Finward Bancorp's long position.Magyar Bancorp vs. Lake Shore Bancorp | Magyar Bancorp vs. Community West Bancshares | Magyar Bancorp vs. Plumas Bancorp | Magyar Bancorp vs. First Community |
Finward Bancorp vs. First Community | Finward Bancorp vs. Community West Bancshares | Finward Bancorp vs. First Northwest Bancorp | Finward Bancorp vs. First Guaranty Bancshares |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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