Correlation Between First Republic and Meridian Bank
Can any of the company-specific risk be diversified away by investing in both First Republic and Meridian Bank 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 Republic and Meridian Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Republic Bank and Meridian Bank, you can compare the effects of market volatilities on First Republic and Meridian Bank 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 Republic with a short position of Meridian Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Republic and Meridian Bank.
Diversification Opportunities for First Republic and Meridian Bank
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Meridian is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding First Republic Bank and Meridian Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meridian Bank and First Republic 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 Republic Bank are associated (or correlated) with Meridian Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meridian Bank has no effect on the direction of First Republic i.e., First Republic and Meridian Bank go up and down completely randomly.
Pair Corralation between First Republic and Meridian Bank
If you would invest 1,155 in Meridian Bank on November 2, 2024 and sell it today you would earn a total of 506.00 from holding Meridian Bank or generate 43.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.97% |
| Values | Daily Returns |
First Republic Bank vs. Meridian Bank
Performance |
| Timeline |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Meridian Bank |
First Republic and Meridian Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Republic and Meridian Bank
The main advantage of trading using opposite First Republic and Meridian Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Republic position performs unexpectedly, Meridian Bank 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 Meridian Bank will offset losses from the drop in Meridian Bank's long position.| First Republic vs. East Africa Metals | First Republic vs. Perseus Mining Limited | First Republic vs. ioneer Ltd American | First Republic vs. Uranium Energy Corp |
| Meridian Bank vs. Community West Bancshares | Meridian Bank vs. Investar Holding Corp | Meridian Bank vs. Finward Bancorp | Meridian Bank vs. First Financial Northwest |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |