Correlation Between Amalgamated Financial and Bar Harbor

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Can any of the company-specific risk be diversified away by investing in both Amalgamated Financial and Bar Harbor 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 Amalgamated Financial and Bar Harbor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amalgamated Financial Corp and Bar Harbor Bankshares, you can compare the effects of market volatilities on Amalgamated Financial and Bar Harbor 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 Amalgamated Financial with a short position of Bar Harbor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amalgamated Financial and Bar Harbor.

Diversification Opportunities for Amalgamated Financial and Bar Harbor

0.83
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Amalgamated and Bar Harbor is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Amalgamated Financial Corp and Bar Harbor Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bar Harbor Bankshares and Amalgamated Financial 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 Amalgamated Financial Corp are associated (or correlated) with Bar Harbor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bar Harbor Bankshares has no effect on the direction of Amalgamated Financial i.e., Amalgamated Financial and Bar Harbor go up and down completely randomly.

Pair Corralation between Amalgamated Financial and Bar Harbor

Given the investment horizon of 90 days Amalgamated Financial Corp is expected to generate 0.66 times more return on investment than Bar Harbor. However, Amalgamated Financial Corp is 1.52 times less risky than Bar Harbor. It trades about 0.08 of its potential returns per unit of risk. Bar Harbor Bankshares is currently generating about -0.08 per unit of risk. If you would invest  2,249  in Amalgamated Financial Corp on June 28, 2022 and sell it today you would earn a total of  46.00  from holding Amalgamated Financial Corp or generate 2.05% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Amalgamated Financial Corp  vs.  Bar Harbor Bankshares

 Performance (%) 
       Timeline  
Amalgamated Financial 
Amalgamated Performance
11 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Amalgamated Financial Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Amalgamated Financial revealed solid returns over the last few months and may actually be approaching a breakup point.

Amalgamated Price Channel

Bar Harbor Bankshares 
Bar Harbor Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Bar Harbor Bankshares are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical indicators, Bar Harbor is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Bar Harbor Price Channel

Amalgamated Financial and Bar Harbor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amalgamated Financial and Bar Harbor

The main advantage of trading using opposite Amalgamated Financial and Bar Harbor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amalgamated Financial position performs unexpectedly, Bar Harbor 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 Bar Harbor will offset losses from the drop in Bar Harbor's long position.
Amalgamated Financial vs. Kibush Capital Corp
The idea behind Amalgamated Financial Corp and Bar Harbor Bankshares 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.
Bar Harbor vs. Kibush Capital Corp
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.

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