Correlation Between Huntington Bancshares and Lumbee Guaranty
Can any of the company-specific risk be diversified away by investing in both Huntington Bancshares and Lumbee Guaranty 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 Lumbee Guaranty 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 Lumbee Guaranty Bank, you can compare the effects of market volatilities on Huntington Bancshares and Lumbee Guaranty 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 Lumbee Guaranty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huntington Bancshares and Lumbee Guaranty.
Diversification Opportunities for Huntington Bancshares and Lumbee Guaranty
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Huntington and Lumbee is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Huntington Bancshares Incorpor and Lumbee Guaranty Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumbee Guaranty Bank 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 Lumbee Guaranty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumbee Guaranty Bank has no effect on the direction of Huntington Bancshares i.e., Huntington Bancshares and Lumbee Guaranty go up and down completely randomly.
Pair Corralation between Huntington Bancshares and Lumbee Guaranty
Given the investment horizon of 90 days Huntington Bancshares Incorporated is expected to generate 1.82 times more return on investment than Lumbee Guaranty. However, Huntington Bancshares is 1.82 times more volatile than Lumbee Guaranty Bank. It trades about 0.22 of its potential returns per unit of risk. Lumbee Guaranty Bank is currently generating about 0.14 per unit of risk. If you would invest 1,574 in Huntington Bancshares Incorporated on August 31, 2024 and sell it today you would earn a total of 226.00 from holding Huntington Bancshares Incorporated or generate 14.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huntington Bancshares Incorpor vs. Lumbee Guaranty Bank
Performance |
| Timeline |
| Huntington Bancshares |
| Lumbee Guaranty Bank |
Huntington Bancshares and Lumbee Guaranty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huntington Bancshares and Lumbee Guaranty
The main advantage of trading using opposite Huntington Bancshares and Lumbee Guaranty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huntington Bancshares position performs unexpectedly, Lumbee Guaranty 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 Lumbee Guaranty will offset losses from the drop in Lumbee Guaranty's long position.| Huntington Bancshares vs. Zions Bancorporation | Huntington Bancshares vs. Comerica | Huntington Bancshares vs. Western Alliance Bancorporation | Huntington Bancshares vs. US Bancorp |
| Lumbee Guaranty vs. Bank Mandiri Persero | Lumbee Guaranty vs. Piraeus Bank SA | Lumbee Guaranty vs. Eurobank Ergasias Services | Lumbee Guaranty vs. Kasikornbank Public Co |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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