Correlation Between First Citizens and Wintrust Financial
Can any of the company-specific risk be diversified away by investing in both First Citizens and Wintrust Financial 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 Citizens and Wintrust Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Citizens BancShares and Wintrust Financial Corp, you can compare the effects of market volatilities on First Citizens and Wintrust Financial 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 Citizens with a short position of Wintrust Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Citizens and Wintrust Financial.
Diversification Opportunities for First Citizens and Wintrust Financial
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between First and Wintrust is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding First Citizens BancShares and Wintrust Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wintrust Financial Corp and First Citizens 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 Citizens BancShares are associated (or correlated) with Wintrust Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wintrust Financial Corp has no effect on the direction of First Citizens i.e., First Citizens and Wintrust Financial go up and down completely randomly.
Pair Corralation between First Citizens and Wintrust Financial
Assuming the 90 days horizon First Citizens is expected to generate 4.21 times less return on investment than Wintrust Financial. In addition to that, First Citizens is 10.72 times more volatile than Wintrust Financial Corp. It trades about 0.01 of its total potential returns per unit of risk. Wintrust Financial Corp is currently generating about 0.3 per unit of volatility. If you would invest 2,487 in Wintrust Financial Corp on October 26, 2024 and sell it today you would earn a total of 24.00 from holding Wintrust Financial Corp or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Citizens BancShares vs. Wintrust Financial Corp
Performance |
| Timeline |
| First Citizens BancShares |
| Wintrust Financial Corp |
First Citizens and Wintrust Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Citizens and Wintrust Financial
The main advantage of trading using opposite First Citizens and Wintrust Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Citizens position performs unexpectedly, Wintrust Financial 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 Wintrust Financial will offset losses from the drop in Wintrust Financial's long position.| First Citizens vs. Fifth Third Bancorp | First Citizens vs. Dime Community Bancshares | First Citizens vs. Fifth Third Bancorp | First Citizens vs. Northern Trust |
| Wintrust Financial vs. Wintrust Financial Corp | Wintrust Financial vs. WesBanco | Wintrust Financial vs. Heartland Financial USA | Wintrust Financial vs. Pinnacle Financial Partners |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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