Correlation Between Virginia National and Catalyst Bancorp
Can any of the company-specific risk be diversified away by investing in both Virginia National and Catalyst 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 Virginia National and Catalyst Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virginia National Bankshares and Catalyst Bancorp, you can compare the effects of market volatilities on Virginia National and Catalyst 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 Virginia National with a short position of Catalyst Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virginia National and Catalyst Bancorp.
Diversification Opportunities for Virginia National and Catalyst Bancorp
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Virginia and Catalyst is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Virginia National Bankshares and Catalyst Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalyst Bancorp and Virginia National 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 Virginia National Bankshares are associated (or correlated) with Catalyst Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalyst Bancorp has no effect on the direction of Virginia National i.e., Virginia National and Catalyst Bancorp go up and down completely randomly.
Pair Corralation between Virginia National and Catalyst Bancorp
Given the investment horizon of 90 days Virginia National Bankshares is expected to generate 2.04 times more return on investment than Catalyst Bancorp. However, Virginia National is 2.04 times more volatile than Catalyst Bancorp. It trades about 0.08 of its potential returns per unit of risk. Catalyst Bancorp is currently generating about 0.13 per unit of risk. If you would invest 3,689 in Virginia National Bankshares on June 9, 2025 and sell it today you would earn a total of 346.00 from holding Virginia National Bankshares or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virginia National Bankshares vs. Catalyst Bancorp
Performance |
| Timeline |
| Virginia National |
| Catalyst Bancorp |
Virginia National and Catalyst Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virginia National and Catalyst Bancorp
The main advantage of trading using opposite Virginia National and Catalyst Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virginia National position performs unexpectedly, Catalyst 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 Catalyst Bancorp will offset losses from the drop in Catalyst Bancorp's long position.| Virginia National vs. Home Federal Bancorp | Virginia National vs. Magyar Bancorp | Virginia National vs. Lake Shore Bancorp | Virginia National vs. Old Point Financial |
| Catalyst Bancorp vs. Community West Bancshares | Catalyst Bancorp vs. Liberty Northwest Bancorp | Catalyst Bancorp vs. Pioneer Bankcorp | Catalyst Bancorp vs. Summit Bancshares |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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