Correlation Between Astronics and Parke Bancorp
Can any of the company-specific risk be diversified away by investing in both Astronics and Parke 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 Astronics and Parke Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astronics and Parke Bancorp, you can compare the effects of market volatilities on Astronics and Parke 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 Astronics with a short position of Parke Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astronics and Parke Bancorp.
Diversification Opportunities for Astronics and Parke Bancorp
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Astronics and Parke is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Astronics and Parke Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parke Bancorp and Astronics 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 Astronics are associated (or correlated) with Parke Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parke Bancorp has no effect on the direction of Astronics i.e., Astronics and Parke Bancorp go up and down completely randomly.
Pair Corralation between Astronics and Parke Bancorp
Given the investment horizon of 90 days Astronics is expected to generate 1.51 times more return on investment than Parke Bancorp. However, Astronics is 1.51 times more volatile than Parke Bancorp. It trades about 0.05 of its potential returns per unit of risk. Parke Bancorp is currently generating about 0.04 per unit of risk. If you would invest 1,829 in Astronics on April 4, 2025 and sell it today you would earn a total of 1,424 from holding Astronics or generate 77.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Astronics vs. Parke Bancorp
Performance |
| Timeline |
| Astronics |
| Parke Bancorp |
Astronics and Parke Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astronics and Parke Bancorp
The main advantage of trading using opposite Astronics and Parke Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astronics position performs unexpectedly, Parke 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 Parke Bancorp will offset losses from the drop in Parke Bancorp's long position.| Astronics vs. Stepan Company | Astronics vs. Griffon | Astronics vs. Torm PLC Class | Astronics vs. Lithium Americas Corp |
| Parke Bancorp vs. Merit Medical Systems | Parke Bancorp vs. Alvotech | Parke Bancorp vs. XWELL Inc | Parke Bancorp vs. MedX Health 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 the Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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