Correlation Between ACNB and Eagle Financial
Can any of the company-specific risk be diversified away by investing in both ACNB and Eagle 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 ACNB and Eagle Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACNB Corporation and Eagle Financial Services, you can compare the effects of market volatilities on ACNB and Eagle 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 ACNB with a short position of Eagle Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACNB and Eagle Financial.
Diversification Opportunities for ACNB and Eagle Financial
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between ACNB and Eagle is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding ACNB Corp. and Eagle Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Financial Services and ACNB 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 ACNB Corporation are associated (or correlated) with Eagle Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Financial Services has no effect on the direction of ACNB i.e., ACNB and Eagle Financial go up and down completely randomly.
Pair Corralation between ACNB and Eagle Financial
Given the investment horizon of 90 days ACNB Corporation is expected to under-perform the Eagle Financial. In addition to that, ACNB is 4.59 times more volatile than Eagle Financial Services. It trades about -0.21 of its total potential returns per unit of risk. Eagle Financial Services is currently generating about -0.3 per unit of volatility. If you would invest 3,000 in Eagle Financial Services on January 19, 2024 and sell it today you would lose (115.00) from holding Eagle Financial Services or give up 3.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ACNB Corp. vs. Eagle Financial Services
Performance |
| Timeline |
| ACNB |
| Eagle Financial Services |
ACNB and Eagle Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACNB and Eagle Financial
The main advantage of trading using opposite ACNB and Eagle Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACNB position performs unexpectedly, Eagle 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 Eagle Financial will offset losses from the drop in Eagle Financial's long position.| ACNB vs. Bankwell Financial Group | ACNB vs. Codorus Valley Bancorp | ACNB vs. Ames National | ACNB vs. Chemung Financial Corp |
| Eagle Financial vs. Pfizer Inc | Eagle Financial vs. Heartland Financial USA | Eagle Financial vs. Conflux Network | Eagle Financial vs. Citigroup Capital XIII |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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