Correlation Between International Game and Codorus Valley

Can any of the company-specific risk be diversified away by investing in both International Game and Codorus Valley 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 International Game and Codorus Valley into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between International Game Technology and Codorus Valley Bancorp, you can compare the effects of market volatilities on International Game and Codorus Valley 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 International Game with a short position of Codorus Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Game and Codorus Valley.

Diversification Opportunities for International Game and Codorus Valley

0.72

Correlation Coefficient

International Game  Codorus Valley

Poor diversification

The 3 months correlation between International and Codorus is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding International Game Technology and Codorus Valley Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codorus Valley Bancorp and International Game 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 International Game Technology are associated (or correlated) with Codorus Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codorus Valley Bancorp has no effect on the direction of International Game i.e., International Game and Codorus Valley go up and down completely randomly.

Pair Corralation between International Game and Codorus Valley

If you would invest  2,224  in Codorus Valley Bancorp on February 1, 2024 and sell it today you would lose (4.00) from holding Codorus Valley Bancorp or give up 0.18% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

International Game Technology  vs.  Codorus Valley Bancorp

International Game

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days International Game Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in June 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Codorus Valley Bancorp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Codorus Valley Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, Codorus Valley is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with International Game and Codorus Valley

The main advantage of trading using opposite International Game and Codorus Valley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Game position performs unexpectedly, Codorus Valley 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 Codorus Valley will offset losses from the drop in Codorus Valley's long position.

The idea behind International Game Technology and Codorus Valley Bancorp 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.

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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..