Correlation Between NYSE Composite and Hancock Whitney
Can any of the company-specific risk be diversified away by investing in both NYSE Composite 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 NYSE Composite and Hancock Whitney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Hancock Whitney Corp, you can compare the effects of market volatilities on NYSE Composite 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 NYSE Composite with a short position of Hancock Whitney. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Hancock Whitney.
Diversification Opportunities for NYSE Composite and Hancock Whitney
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Hancock is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite 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 NYSE Composite 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 NYSE Composite 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 NYSE Composite i.e., NYSE Composite and Hancock Whitney go up and down completely randomly.
Pair Corralation between NYSE Composite and Hancock Whitney
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.81 times less return on investment than Hancock Whitney. But when comparing it to its historical volatility, NYSE Composite is 3.01 times less risky than Hancock Whitney. It trades about 0.1 of its potential returns per unit of risk. Hancock Whitney Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 4,279 in Hancock Whitney Corp on February 23, 2024 and sell it today you would earn a total of 407.00 from holding Hancock Whitney Corp or generate 9.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
NYSE Composite vs. Hancock Whitney Corp
Performance |
Timeline |
NYSE Composite and Hancock Whitney Volatility Contrast
Predicted Return Density |
Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Hancock Whitney Corp
Pair trading matchups for Hancock Whitney
Pair Trading with NYSE Composite and Hancock Whitney
The main advantage of trading using opposite NYSE Composite and Hancock Whitney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite 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.NYSE Composite vs. Playa Hotels Resorts | NYSE Composite vs. American Clean Resources | NYSE Composite vs. Ultra Clean Holdings | NYSE Composite vs. Daily Journal Corp |
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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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