Correlation Between Oracle and Hancock Whitney

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

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

Diversification Opportunities for Oracle and Hancock Whitney

-0.06

Correlation Coefficient

Oracle  Hancock Whitney

Good diversification

The 3 months correlation between Oracle and Hancock is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Oracle 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 Oracle 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 Oracle 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 Oracle i.e., Oracle and Hancock Whitney go up and down completely randomly.

Pair Corralation between Oracle and Hancock Whitney

Given the investment horizon of 90 days Oracle is expected to generate 0.86 times more return on investment than Hancock Whitney. However, Oracle is 1.16 times less risky than Hancock Whitney. It trades about 0.06 of its potential returns per unit of risk. Hancock Whitney Corp is currently generating about 0.05 per unit of risk. If you would invest  9,220  in Oracle on February 26, 2024 and sell it today you would earn a total of  3,071  from holding Oracle or generate 33.31% return on investment over 90 days.

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

Oracle  vs.  Hancock Whitney Corp

Oracle

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Oracle are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady fundamental indicators, Oracle may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Hancock Whitney Corp

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hancock Whitney Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Hancock Whitney may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Pair Trading with Oracle and Hancock Whitney

The main advantage of trading using opposite Oracle and Hancock Whitney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oracle 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 Oracle 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.