Correlation Between First Republic and Territorial Bancorp
Can any of the company-specific risk be diversified away by investing in both First Republic and Territorial Bancorp 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 Territorial Bancorp 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 Territorial Bancorp, you can compare the effects of market volatilities on First Republic and Territorial Bancorp 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 Territorial Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Republic and Territorial Bancorp.
Diversification Opportunities for First Republic and Territorial Bancorp
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between First and Territorial is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding First Republic Bank and Territorial Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Territorial Bancorp 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 Territorial Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Territorial Bancorp has no effect on the direction of First Republic i.e., First Republic and Territorial Bancorp go up and down completely randomly.
Pair Corralation between First Republic and Territorial Bancorp
If you would invest 1,053 in Territorial Bancorp on August 25, 2024 and sell it today you would earn a total of 41.00 from holding Territorial Bancorp or generate 3.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
First Republic Bank vs. Territorial Bancorp
Performance |
| Timeline |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Territorial Bancorp |
First Republic and Territorial Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Republic and Territorial Bancorp
The main advantage of trading using opposite First Republic and Territorial Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Republic position performs unexpectedly, Territorial Bancorp 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 Territorial Bancorp will offset losses from the drop in Territorial Bancorp's long position.| First Republic vs. AmTrust Financial Services | First Republic vs. Chiba Bank Ltd | First Republic vs. SNDL Inc | First Republic vs. Glacier Bancorp |
| Territorial Bancorp vs. First Hawaiian | Territorial Bancorp vs. Bank of Hawaii | Territorial Bancorp vs. Financial Institutions | Territorial Bancorp vs. Heritage Financial |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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