Correlation Between CullenFrost Bankers and MAANSHAN IRON
Can any of the company-specific risk be diversified away by investing in both CullenFrost Bankers and MAANSHAN IRON 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 CullenFrost Bankers and MAANSHAN IRON into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CullenFrost Bankers and MAANSHAN IRON H , you can compare the effects of market volatilities on CullenFrost Bankers and MAANSHAN IRON 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 CullenFrost Bankers with a short position of MAANSHAN IRON. Check out your portfolio center. Please also check ongoing floating volatility patterns of CullenFrost Bankers and MAANSHAN IRON.
Diversification Opportunities for CullenFrost Bankers and MAANSHAN IRON
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CullenFrost and MAANSHAN is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding CullenFrost Bankers and MAANSHAN IRON H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAANSHAN IRON H and CullenFrost Bankers 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 CullenFrost Bankers are associated (or correlated) with MAANSHAN IRON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAANSHAN IRON H has no effect on the direction of CullenFrost Bankers i.e., CullenFrost Bankers and MAANSHAN IRON go up and down completely randomly.
Pair Corralation between CullenFrost Bankers and MAANSHAN IRON
Assuming the 90 days horizon CullenFrost Bankers is expected to generate 2.36 times less return on investment than MAANSHAN IRON. But when comparing it to its historical volatility, CullenFrost Bankers is 2.19 times less risky than MAANSHAN IRON. It trades about 0.02 of its potential returns per unit of risk. MAANSHAN IRON H is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 19.00 in MAANSHAN IRON H on October 30, 2024 and sell it today you would earn a total of 2.00 from holding MAANSHAN IRON H or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CullenFrost Bankers vs. MAANSHAN IRON H
Performance |
| Timeline |
| CullenFrost Bankers |
| MAANSHAN IRON H |
CullenFrost Bankers and MAANSHAN IRON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CullenFrost Bankers and MAANSHAN IRON
The main advantage of trading using opposite CullenFrost Bankers and MAANSHAN IRON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CullenFrost Bankers position performs unexpectedly, MAANSHAN IRON 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 MAANSHAN IRON will offset losses from the drop in MAANSHAN IRON's long position.| CullenFrost Bankers vs. The PNC Financial | CullenFrost Bankers vs. Huntington Bancshares Incorporated | CullenFrost Bankers vs. Regions Financial | CullenFrost Bankers vs. KeyCorp |
| MAANSHAN IRON vs. Apple Inc | MAANSHAN IRON vs. Apple Inc | MAANSHAN IRON vs. Apple Inc | MAANSHAN IRON vs. Apple Inc |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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