Correlation Between Guaranty Bancshares, and First Trust
Can any of the company-specific risk be diversified away by investing in both Guaranty Bancshares, and First Trust 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 Guaranty Bancshares, and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guaranty Bancshares, and First Trust Lunt, you can compare the effects of market volatilities on Guaranty Bancshares, and First Trust 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 Guaranty Bancshares, with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guaranty Bancshares, and First Trust.
Diversification Opportunities for Guaranty Bancshares, and First Trust
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guaranty and First is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Guaranty Bancshares, and First Trust Lunt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Lunt and Guaranty Bancshares, 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 Guaranty Bancshares, are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Lunt has no effect on the direction of Guaranty Bancshares, i.e., Guaranty Bancshares, and First Trust go up and down completely randomly.
Pair Corralation between Guaranty Bancshares, and First Trust
Given the investment horizon of 90 days Guaranty Bancshares, is expected to generate 2.17 times more return on investment than First Trust. However, Guaranty Bancshares, is 2.17 times more volatile than First Trust Lunt. It trades about 0.05 of its potential returns per unit of risk. First Trust Lunt is currently generating about 0.05 per unit of risk. If you would invest 2,533 in Guaranty Bancshares, on November 28, 2024 and sell it today you would earn a total of 1,388 from holding Guaranty Bancshares, or generate 54.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guaranty Bancshares, vs. First Trust Lunt
Performance |
| Timeline |
| Guaranty Bancshares, |
| First Trust Lunt |
Guaranty Bancshares, and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guaranty Bancshares, and First Trust
The main advantage of trading using opposite Guaranty Bancshares, and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guaranty Bancshares, position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| Guaranty Bancshares, vs. First Community | Guaranty Bancshares, vs. Community West Bancshares | Guaranty Bancshares, vs. First Financial Northwest | Guaranty Bancshares, vs. First Northwest Bancorp |
| First Trust vs. FT Vest Equity | First Trust vs. Northern Lights | First Trust vs. Dimensional International High | First Trust vs. First Trust Exchange Traded |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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