Correlation Between First State and SP Plus
Can any of the company-specific risk be diversified away by investing in both First State and SP Plus 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 State and SP Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First State Financial and SP Plus Corp, you can compare the effects of market volatilities on First State and SP Plus 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 State with a short position of SP Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of First State and SP Plus.
Diversification Opportunities for First State and SP Plus
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and SP Plus is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding First State Financial and SP Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SP Plus Corp and First State 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 State Financial are associated (or correlated) with SP Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SP Plus Corp has no effect on the direction of First State i.e., First State and SP Plus go up and down completely randomly.
Pair Corralation between First State and SP Plus
If you would invest 3,921 in SP Plus Corp on September 4, 2024 and sell it today you would earn a total of 0.00 from holding SP Plus Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First State Financial vs. SP Plus Corp
Performance |
| Timeline |
| First State Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SP Plus Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
First State and SP Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First State and SP Plus
The main advantage of trading using opposite First State and SP Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First State position performs unexpectedly, SP Plus 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 SP Plus will offset losses from the drop in SP Plus' long position.| First State vs. First Interstate BancSystem | First State vs. First Financial Bankshares | First State vs. Independent Bank Group | First State vs. CVB Financial |
| SP Plus vs. Cass Information Systems | SP Plus vs. First Advantage Corp | SP Plus vs. Rentokil Initial PLC | SP Plus vs. CBIZ Inc |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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