Correlation Between Citizens Financial and Hancock Whitney
Can any of the company-specific risk be diversified away by investing in both Citizens Financial 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 Citizens Financial and Hancock Whitney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Financial Group and Hancock Whitney Corp, you can compare the effects of market volatilities on Citizens Financial 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 Citizens Financial with a short position of Hancock Whitney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Hancock Whitney.
Diversification Opportunities for Citizens Financial and Hancock Whitney
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citizens and Hancock is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group 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 Citizens 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 Citizens Financial Group 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 Citizens Financial i.e., Citizens Financial and Hancock Whitney go up and down completely randomly.
Pair Corralation between Citizens Financial and Hancock Whitney
Assuming the 90 days trading horizon Citizens Financial is expected to generate 2.99 times less return on investment than Hancock Whitney. But when comparing it to its historical volatility, Citizens Financial Group is 1.51 times less risky than Hancock Whitney. It trades about 0.03 of its potential returns per unit of risk. Hancock Whitney Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3,749 in Hancock Whitney Corp on August 27, 2024 and sell it today you would earn a total of 2,248 from holding Hancock Whitney Corp or generate 59.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Financial Group vs. Hancock Whitney Corp
Performance |
| Timeline |
| Citizens Financial |
| Hancock Whitney Corp |
Citizens Financial and Hancock Whitney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and Hancock Whitney
The main advantage of trading using opposite Citizens Financial and Hancock Whitney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial 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.| Citizens Financial vs. Capital One Financial | Citizens Financial vs. Capital One Financial | Citizens Financial vs. Bank of America |
| Hancock Whitney vs. Fifth Third Bancorp | Hancock Whitney vs. Zions Bancorporation | Hancock Whitney vs. Huntington Bancshares Incorporated | Hancock Whitney vs. Comerica |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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