Correlation Between Huntington Bancshares and New York
Can any of the company-specific risk be diversified away by investing in both Huntington Bancshares and New York 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 New York 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 New York Community, you can compare the effects of market volatilities on Huntington Bancshares and New York 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 New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huntington Bancshares and New York.
Diversification Opportunities for Huntington Bancshares and New York
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huntington and New is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Huntington Bancshares Incorpor and New York Community in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New York Community 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 New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New York Community has no effect on the direction of Huntington Bancshares i.e., Huntington Bancshares and New York go up and down completely randomly.
Pair Corralation between Huntington Bancshares and New York
Given the investment horizon of 90 days Huntington Bancshares Incorporated is expected to generate 0.6 times more return on investment than New York. However, Huntington Bancshares Incorporated is 1.66 times less risky than New York. It trades about 0.16 of its potential returns per unit of risk. New York Community is currently generating about -0.03 per unit of risk. If you would invest 1,448 in Huntington Bancshares Incorporated on August 23, 2024 and sell it today you would earn a total of 314.00 from holding Huntington Bancshares Incorporated or generate 21.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 71.88% |
| Values | Daily Returns |
Huntington Bancshares Incorpor vs. New York Community
Performance |
| Timeline |
| Huntington Bancshares |
| New York Community |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Huntington Bancshares and New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huntington Bancshares and New York
The main advantage of trading using opposite Huntington Bancshares and New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huntington Bancshares position performs unexpectedly, New York 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 New York will offset losses from the drop in New York's long position.| Huntington Bancshares vs. Zions Bancorporation | Huntington Bancshares vs. Comerica | Huntington Bancshares vs. Western Alliance Bancorporation | Huntington Bancshares vs. US Bancorp |
| New York vs. KeyCorp | New York vs. Fifth Third Bancorp | New York vs. Regions Financial | New York vs. Zions 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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