Correlation Between First Republic and Regions Financial
Can any of the company-specific risk be diversified away by investing in both First Republic and Regions 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 Regions 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 Regions Financial, you can compare the effects of market volatilities on First Republic and Regions 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 Regions Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Republic and Regions Financial.
Diversification Opportunities for First Republic and Regions Financial
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between First and Regions is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding First Republic Bank and Regions Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regions Financial 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 Regions Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regions Financial has no effect on the direction of First Republic i.e., First Republic and Regions Financial go up and down completely randomly.
Pair Corralation between First Republic and Regions Financial
If you would invest 2,465 in Regions Financial on August 27, 2024 and sell it today you would earn a total of 3.00 from holding Regions Financial or generate 0.12% 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. Regions Financial
Performance |
| Timeline |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Regions Financial |
First Republic and Regions Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Republic and Regions Financial
The main advantage of trading using opposite First Republic and Regions Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Republic position performs unexpectedly, Regions 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 Regions Financial will offset losses from the drop in Regions Financial's long position.| First Republic vs. Primoris Services | First Republic vs. Chemours Co | First Republic vs. Minerals Technologies | First Republic vs. Stepan Company |
| Regions Financial vs. Capital One Financial | Regions Financial vs. Capital One Financial | Regions Financial vs. Bank of America |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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