Correlation Between US Bancorp and FIRST REP
Can any of the company-specific risk be diversified away by investing in both US Bancorp and FIRST REP 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 US Bancorp and FIRST REP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Bancorp and FIRST REP BK, you can compare the effects of market volatilities on US Bancorp and FIRST REP 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 US Bancorp with a short position of FIRST REP. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Bancorp and FIRST REP.
Diversification Opportunities for US Bancorp and FIRST REP
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between USB and FIRST is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding US Bancorp and FIRST REP BK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIRST REP BK and US Bancorp 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 US Bancorp are associated (or correlated) with FIRST REP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIRST REP BK has no effect on the direction of US Bancorp i.e., US Bancorp and FIRST REP go up and down completely randomly.
Pair Corralation between US Bancorp and FIRST REP
If you would invest 4,061 in US Bancorp on February 12, 2024 and sell it today you would earn a total of 124.00 from holding US Bancorp or generate 3.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 1.56% |
Values | Daily Returns |
US Bancorp vs. FIRST REP BK
Performance |
Timeline |
US Bancorp |
FIRST REP BK |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
US Bancorp and FIRST REP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with US Bancorp and FIRST REP
The main advantage of trading using opposite US Bancorp and FIRST REP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Bancorp position performs unexpectedly, FIRST REP 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 FIRST REP will offset losses from the drop in FIRST REP's long position.US Bancorp vs. PNC Financial Services | US Bancorp vs. KeyCorp | US Bancorp vs. Zions Bancorporation | US Bancorp vs. Fifth Third Bancorp |
FIRST REP vs. Zions Bancorporation | FIRST REP vs. KeyCorp | FIRST REP vs. Comerica | FIRST REP vs. First Horizon National |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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