Correlation Between Northeast Indiana and Old National

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

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

Diversification Opportunities for Northeast Indiana and Old National

0.0

Correlation Coefficient

Northeast Indiana  Old National

Pay attention - limited upside

The 3 months correlation between Northeast and Old is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Northeast Indiana Bancorp and Old National Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old National Bancorp and Northeast Indiana 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 Northeast Indiana Bancorp are associated (or correlated) with Old National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old National Bancorp has no effect on the direction of Northeast Indiana i.e., Northeast Indiana and Old National go up and down completely randomly.

Pair Corralation between Northeast Indiana and Old National

If you would invest  2,096  in Old National Bancorp on May 6, 2025 and sell it today you would lose (19.00) from holding Old National Bancorp or give up 0.91% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Northeast Indiana Bancorp  vs.  Old National Bancorp

Northeast Indiana Bancorp

Risk-Adjusted Performance

Very Weak

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

Old National Bancorp

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Northeast Indiana and Old National

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

The idea behind Northeast Indiana Bancorp and Old National 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.

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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.