Correlation Between Regions Financial and Blueharbor Bank

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

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

Diversification Opportunities for Regions Financial and Blueharbor Bank

0.0

Correlation Coefficient

Regions Financial  Blueharbor Bank

Pay attention - limited upside

The 3 months correlation between Regions and Blueharbor is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Regions Financial and Blueharbor Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blueharbor Bank and Regions Financial 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 Regions Financial are associated (or correlated) with Blueharbor Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blueharbor Bank has no effect on the direction of Regions Financial i.e., Regions Financial and Blueharbor Bank go up and down completely randomly.

Pair Corralation between Regions Financial and Blueharbor Bank

If you would invest  2,228  in Regions Financial on March 11, 2024 and sell it today you would earn a total of  52.00  from holding Regions Financial or generate 2.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Regions Financial  vs.  Blueharbor Bank

Regions Financial

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Regions Financial are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Regions Financial is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Blueharbor Bank

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blueharbor Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical indicators, Blueharbor Bank is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Regions Financial and Blueharbor Bank

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

The idea behind Regions Financial and Blueharbor Bank 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.