Correlation Between First Bancshares and First Citizens
Can any of the company-specific risk be diversified away by investing in both First Bancshares and First Citizens 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 First Bancshares and First Citizens into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Bancshares and The First Citizens, you can compare the effects of market volatilities on First Bancshares and First Citizens 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 First Bancshares with a short position of First Citizens. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Bancshares and First Citizens.
Diversification Opportunities for First Bancshares and First Citizens
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Bancshares and The First Citizens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Citizens and First Bancshares 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 First Bancshares are associated (or correlated) with First Citizens. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Citizens has no effect on the direction of First Bancshares i.e., First Bancshares and First Citizens go up and down completely randomly.
Pair Corralation between First Bancshares and First Citizens
If you would invest 6,540 in The First Citizens on November 5, 2024 and sell it today you would earn a total of 0.00 from holding The First Citizens or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Bancshares vs. The First Citizens
Performance |
| Timeline |
| First Bancshares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| First Citizens |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
First Bancshares and First Citizens Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Bancshares and First Citizens
The main advantage of trading using opposite First Bancshares and First Citizens positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Bancshares position performs unexpectedly, First Citizens 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 Citizens will offset losses from the drop in First Citizens' long position.| First Bancshares vs. Lewis Clark Bancorp | First Bancshares vs. Bank of Idaho | First Bancshares vs. Community Heritage Financial | First Bancshares vs. National Capital Bank |
| First Citizens vs. National Storage REIT | First Citizens vs. United Natural Foods | First Citizens vs. Paranovus Entertainment Technology | First Citizens vs. Data3 Limited |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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