Correlation Between Huntington Bancshares and Columbia Financial
Can any of the company-specific risk be diversified away by investing in both Huntington Bancshares and Columbia 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 Huntington Bancshares and Columbia Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huntington Bancshares Incorporated and Columbia Financial, you can compare the effects of market volatilities on Huntington Bancshares and Columbia 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 Huntington Bancshares with a short position of Columbia Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huntington Bancshares and Columbia Financial.
Diversification Opportunities for Huntington Bancshares and Columbia Financial
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huntington and Columbia is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Huntington Bancshares Incorpor and Columbia Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Financial and Huntington 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 Huntington Bancshares Incorporated are associated (or correlated) with Columbia Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Financial has no effect on the direction of Huntington Bancshares i.e., Huntington Bancshares and Columbia Financial go up and down completely randomly.
Pair Corralation between Huntington Bancshares and Columbia Financial
Given the investment horizon of 90 days Huntington Bancshares Incorporated is expected to generate 0.86 times more return on investment than Columbia Financial. However, Huntington Bancshares Incorporated is 1.16 times less risky than Columbia Financial. It trades about 0.09 of its potential returns per unit of risk. Columbia Financial is currently generating about 0.0 per unit of risk. If you would invest 1,038 in Huntington Bancshares Incorporated on August 31, 2024 and sell it today you would earn a total of 763.00 from holding Huntington Bancshares Incorporated or generate 73.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huntington Bancshares Incorpor vs. Columbia Financial
Performance |
| Timeline |
| Huntington Bancshares |
| Columbia Financial |
Huntington Bancshares and Columbia Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huntington Bancshares and Columbia Financial
The main advantage of trading using opposite Huntington Bancshares and Columbia Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huntington Bancshares position performs unexpectedly, Columbia 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 Columbia Financial will offset losses from the drop in Columbia Financial's long position.| Huntington Bancshares vs. Zions Bancorporation | Huntington Bancshares vs. Comerica | Huntington Bancshares vs. Western Alliance Bancorporation | Huntington Bancshares vs. US Bancorp |
| Columbia Financial vs. KeyCorp | Columbia Financial vs. Comerica | Columbia Financial vs. First Horizon National | Columbia Financial vs. Western Alliance Bancorporation |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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