Correlation Between Fulton Financial and Huntington Bancshares
Can any of the company-specific risk be diversified away by investing in both Fulton Financial and Huntington Bancshares 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 Fulton Financial and Huntington Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fulton Financial and Huntington Bancshares Incorporated, you can compare the effects of market volatilities on Fulton Financial and Huntington Bancshares 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 Fulton Financial with a short position of Huntington Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fulton Financial and Huntington Bancshares.
Diversification Opportunities for Fulton Financial and Huntington Bancshares
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fulton and Huntington is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Fulton Financial and Huntington Bancshares Incorpor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huntington Bancshares and Fulton Financial 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 Fulton Financial are associated (or correlated) with Huntington Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huntington Bancshares has no effect on the direction of Fulton Financial i.e., Fulton Financial and Huntington Bancshares go up and down completely randomly.
Pair Corralation between Fulton Financial and Huntington Bancshares
Assuming the 90 days horizon Fulton Financial is expected to under-perform the Huntington Bancshares. But the preferred stock apears to be less risky and, when comparing its historical volatility, Fulton Financial is 1.5 times less risky than Huntington Bancshares. The preferred stock trades about -0.13 of its potential returns per unit of risk. The Huntington Bancshares Incorporated is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,737 in Huntington Bancshares Incorporated on October 26, 2024 and sell it today you would earn a total of 98.00 from holding Huntington Bancshares Incorporated or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fulton Financial vs. Huntington Bancshares Incorpor
Performance |
| Timeline |
| Fulton Financial |
| Huntington Bancshares |
Fulton Financial and Huntington Bancshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fulton Financial and Huntington Bancshares
The main advantage of trading using opposite Fulton Financial and Huntington Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fulton Financial position performs unexpectedly, Huntington Bancshares 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 Huntington Bancshares will offset losses from the drop in Huntington Bancshares' long position.| Fulton Financial vs. First Citizens BancShares | Fulton Financial vs. Fifth Third Bancorp | Fulton Financial vs. Dime Community Bancshares | Fulton Financial vs. Heartland Financial USA |
| Huntington Bancshares vs. Fifth Third Bancorp | Huntington Bancshares vs. Huntington Bancshares Incorporated | Huntington Bancshares vs. Washington Federal | Huntington Bancshares vs. Fifth Third Bancorp |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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