Correlation Between First Republic and Wintrust Financial
Can any of the company-specific risk be diversified away by investing in both First Republic 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 Republic 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 Republic Bank and Wintrust Financial Corp, you can compare the effects of market volatilities on First Republic 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 Republic with a short position of Wintrust Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Republic and Wintrust Financial.
Diversification Opportunities for First Republic and Wintrust Financial
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and Wintrust is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding First Republic Bank 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 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 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 Republic i.e., First Republic and Wintrust Financial go up and down completely randomly.
Pair Corralation between First Republic and Wintrust Financial
If you would invest 2,515 in Wintrust Financial Corp on September 1, 2024 and sell it today you would earn a total of 20.00 from holding Wintrust Financial Corp or generate 0.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
First Republic Bank vs. Wintrust Financial Corp
Performance |
| Timeline |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Wintrust Financial Corp |
First Republic and Wintrust Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Republic and Wintrust Financial
The main advantage of trading using opposite First Republic and Wintrust Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Republic 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 Republic vs. Royalty Management Holding | First Republic vs. Fidus Investment Corp | First Republic vs. Encore Capital Group | First Republic vs. Waste Management |
| Wintrust Financial vs. KeyCorp | Wintrust Financial vs. KeyCorp | Wintrust Financial vs. Fifth Third Bancorp | Wintrust Financial vs. Citizens Financial Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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