Correlation Between Central Pacific and Hancock Whitney
Can any of the company-specific risk be diversified away by investing in both Central Pacific 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 Central Pacific and Hancock Whitney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Central Pacific Financial and Hancock Whitney Corp, you can compare the effects of market volatilities on Central Pacific 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 Central Pacific with a short position of Hancock Whitney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Pacific and Hancock Whitney.
Diversification Opportunities for Central Pacific and Hancock Whitney
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Central and Hancock is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Central Pacific Financial 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 Central Pacific 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 Central Pacific Financial 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 Central Pacific i.e., Central Pacific and Hancock Whitney go up and down completely randomly.
Pair Corralation between Central Pacific and Hancock Whitney
Considering the 90-day investment horizon Central Pacific is expected to generate 1.15 times less return on investment than Hancock Whitney. In addition to that, Central Pacific is 1.03 times more volatile than Hancock Whitney Corp. It trades about 0.17 of its total potential returns per unit of risk. Hancock Whitney Corp is currently generating about 0.2 per unit of volatility. If you would invest 5,159 in Hancock Whitney Corp on August 26, 2024 and sell it today you would earn a total of 838.00 from holding Hancock Whitney Corp or generate 16.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Pacific Financial vs. Hancock Whitney Corp
Performance |
| Timeline |
| Central Pacific Financial |
| Hancock Whitney Corp |
Central Pacific and Hancock Whitney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Pacific and Hancock Whitney
The main advantage of trading using opposite Central Pacific and Hancock Whitney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Pacific 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.| Central Pacific vs. Bank of Hawaii | Central Pacific vs. Territorial Bancorp | Central Pacific vs. First Bancorp | Central Pacific vs. Hancock Whitney Corp |
| Hancock Whitney vs. Home Bancorp | Hancock Whitney vs. First Business Financial | Hancock Whitney vs. LINKBANCORP | Hancock Whitney vs. Great Southern Bancorp |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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