Correlation Between CrossFirst Bankshares and Hancock Whitney

Can any of the company-specific risk be diversified away by investing in both CrossFirst Bankshares and Hancock Whitney 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 CrossFirst Bankshares and Hancock Whitney into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CrossFirst Bankshares and Hancock Whitney Corp, you can compare the effects of market volatilities on CrossFirst Bankshares and Hancock Whitney 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 CrossFirst Bankshares with a short position of Hancock Whitney. Check out your portfolio center. Please also check ongoing floating volatility patterns of CrossFirst Bankshares and Hancock Whitney.

Diversification Opportunities for CrossFirst Bankshares and Hancock Whitney

0.58

Correlation Coefficient

CrossFirst Bankshares  Hancock Whitney

Very weak diversification

The 3 months correlation between CrossFirst and Hancock is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding CrossFirst Bankshares and Hancock Whitney Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hancock Whitney Corp and CrossFirst Bankshares 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 CrossFirst Bankshares are associated (or correlated) with Hancock Whitney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hancock Whitney Corp has no effect on the direction of CrossFirst Bankshares i.e., CrossFirst Bankshares and Hancock Whitney go up and down completely randomly.

Pair Corralation between CrossFirst Bankshares and Hancock Whitney

Considering the 90-day investment horizon CrossFirst Bankshares is expected to under-perform the Hancock Whitney. In addition to that, CrossFirst Bankshares is 1.2 times more volatile than Hancock Whitney Corp. It trades about -0.04 of its total potential returns per unit of risk. Hancock Whitney Corp is currently generating about 0.16 per unit of volatility. If you would invest  4,347  in Hancock Whitney Corp on January 26, 2024 and sell it today you would earn a total of  300.00  from holding Hancock Whitney Corp or generate 6.9% return on investment over 90 days.

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

CrossFirst Bankshares  vs.  Hancock Whitney Corp

CrossFirst Bankshares

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CrossFirst Bankshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Hancock Whitney Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hancock Whitney Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Hancock Whitney is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with CrossFirst Bankshares and Hancock Whitney

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

The idea behind CrossFirst Bankshares and Hancock Whitney Corp 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..