Correlation Between Hilltop Holdings and WSFS Financial
Can any of the company-specific risk be diversified away by investing in both Hilltop Holdings and WSFS 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 Hilltop Holdings and WSFS Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hilltop Holdings and WSFS Financial, you can compare the effects of market volatilities on Hilltop Holdings and WSFS 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 Hilltop Holdings with a short position of WSFS Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hilltop Holdings and WSFS Financial.
Diversification Opportunities for Hilltop Holdings and WSFS Financial
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hilltop and WSFS is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Hilltop Holdings and WSFS Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WSFS Financial and Hilltop Holdings 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 Hilltop Holdings are associated (or correlated) with WSFS Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WSFS Financial has no effect on the direction of Hilltop Holdings i.e., Hilltop Holdings and WSFS Financial go up and down completely randomly.
Pair Corralation between Hilltop Holdings and WSFS Financial
Considering the 90-day investment horizon Hilltop Holdings is expected to under-perform the WSFS Financial. But the stock apears to be less risky and, when comparing its historical volatility, Hilltop Holdings is 1.34 times less risky than WSFS Financial. The stock trades about -0.01 of its potential returns per unit of risk. The WSFS Financial is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 4,951 in WSFS Financial on November 1, 2024 and sell it today you would earn a total of 613.00 from holding WSFS Financial or generate 12.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Hilltop Holdings vs. WSFS Financial
Performance |
Timeline |
Hilltop Holdings |
WSFS Financial |
Hilltop Holdings and WSFS Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hilltop Holdings and WSFS Financial
The main advantage of trading using opposite Hilltop Holdings and WSFS Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hilltop Holdings position performs unexpectedly, WSFS 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 WSFS Financial will offset losses from the drop in WSFS Financial's long position.Hilltop Holdings vs. Home Federal Bancorp | Hilltop Holdings vs. First Financial Northwest | Hilltop Holdings vs. First Northwest Bancorp | Hilltop Holdings vs. First Capital |
WSFS Financial vs. Western New England | WSFS Financial vs. Great Southern Bancorp | WSFS Financial vs. First Financial | WSFS Financial vs. Heritage Financial |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |