Correlation Between First Republic and VersaBank
Can any of the company-specific risk be diversified away by investing in both First Republic and VersaBank 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 VersaBank 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 VersaBank, you can compare the effects of market volatilities on First Republic and VersaBank 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 VersaBank. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Republic and VersaBank.
Diversification Opportunities for First Republic and VersaBank
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and VersaBank is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding First Republic Bank and VersaBank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VersaBank 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 VersaBank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VersaBank has no effect on the direction of First Republic i.e., First Republic and VersaBank go up and down completely randomly.
Pair Corralation between First Republic and VersaBank
If you would invest 1,328 in VersaBank on August 26, 2024 and sell it today you would earn a total of 384.00 from holding VersaBank or generate 28.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 2.27% |
| Values | Daily Returns |
First Republic Bank vs. VersaBank
Performance |
| Timeline |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| VersaBank |
First Republic and VersaBank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Republic and VersaBank
The main advantage of trading using opposite First Republic and VersaBank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Republic position performs unexpectedly, VersaBank 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 VersaBank will offset losses from the drop in VersaBank's long position.| First Republic vs. GoHealth | First Republic vs. Maiden Holdings | First Republic vs. Organic Sales and | First Republic vs. The Hanover Insurance |
| VersaBank vs. Mountain Commerce Bancorp | VersaBank vs. American Riviera Bank | VersaBank vs. Home Federal Bancorp | VersaBank vs. Village Bank and |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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