Correlation Between CF Financial and Mountain Lake
Can any of the company-specific risk be diversified away by investing in both CF Financial and Mountain Lake 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 CF Financial and Mountain Lake into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CF Financial and Mountain Lake Acquisition, you can compare the effects of market volatilities on CF Financial and Mountain Lake 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 CF Financial with a short position of Mountain Lake. Check out your portfolio center. Please also check ongoing floating volatility patterns of CF Financial and Mountain Lake.
Diversification Opportunities for CF Financial and Mountain Lake
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between CFFI and Mountain is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding CF Financial and Mountain Lake Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mountain Lake Acquisition and CF 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 CF Financial are associated (or correlated) with Mountain Lake. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mountain Lake Acquisition has no effect on the direction of CF Financial i.e., CF Financial and Mountain Lake go up and down completely randomly.
Pair Corralation between CF Financial and Mountain Lake
Given the investment horizon of 90 days CF Financial is expected to generate 2.93 times less return on investment than Mountain Lake. But when comparing it to its historical volatility, CF Financial is 1.74 times less risky than Mountain Lake. It trades about 0.02 of its potential returns per unit of risk. Mountain Lake Acquisition is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,044 in Mountain Lake Acquisition on July 20, 2025 and sell it today you would earn a total of 56.00 from holding Mountain Lake Acquisition or generate 5.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CF Financial vs. Mountain Lake Acquisition
Performance |
| Timeline |
| CF Financial |
| Mountain Lake Acquisition |
CF Financial and Mountain Lake Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CF Financial and Mountain Lake
The main advantage of trading using opposite CF Financial and Mountain Lake positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CF Financial position performs unexpectedly, Mountain Lake 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 Mountain Lake will offset losses from the drop in Mountain Lake's long position.| CF Financial vs. Oak Valley Bancorp | CF Financial vs. Virginia National Bankshares | CF Financial vs. First Savings Financial | CF Financial vs. Investar Holding Corp |
| Mountain Lake vs. Haymaker Acquisition Corp | Mountain Lake vs. Voyager Acquisition Corp | Mountain Lake vs. Launch One Acquisition | Mountain Lake vs. Graf Global 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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