Correlation Between Hancock Whitney and Home Bancorp
Can any of the company-specific risk be diversified away by investing in both Hancock Whitney and Home Bancorp 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 Hancock Whitney and Home Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hancock Whitney Corp and Home Bancorp, you can compare the effects of market volatilities on Hancock Whitney and Home Bancorp 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 Hancock Whitney with a short position of Home Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hancock Whitney and Home Bancorp.
Diversification Opportunities for Hancock Whitney and Home Bancorp
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hancock and Home is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Hancock Whitney Corp and Home Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Bancorp and Hancock Whitney 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 Hancock Whitney Corp are associated (or correlated) with Home Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Bancorp has no effect on the direction of Hancock Whitney i.e., Hancock Whitney and Home Bancorp go up and down completely randomly.
Pair Corralation between Hancock Whitney and Home Bancorp
Considering the 90-day investment horizon Hancock Whitney is expected to generate 1.07 times less return on investment than Home Bancorp. But when comparing it to its historical volatility, Hancock Whitney Corp is 1.39 times less risky than Home Bancorp. It trades about 0.25 of its potential returns per unit of risk. Home Bancorp is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 4,629 in Home Bancorp on November 4, 2024 and sell it today you would earn a total of 391.00 from holding Home Bancorp or generate 8.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hancock Whitney Corp vs. Home Bancorp
Performance |
| Timeline |
| Hancock Whitney Corp |
| Home Bancorp |
Hancock Whitney and Home Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hancock Whitney and Home Bancorp
The main advantage of trading using opposite Hancock Whitney and Home Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hancock Whitney position performs unexpectedly, Home Bancorp 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 Home Bancorp will offset losses from the drop in Home Bancorp's long position.| Hancock Whitney vs. Home Bancorp | Hancock Whitney vs. First Business Financial | Hancock Whitney vs. LINKBANCORP | Hancock Whitney vs. Great Southern Bancorp |
| Home Bancorp vs. Home Federal Bancorp | Home Bancorp vs. Community West Bancshares | Home Bancorp vs. First Financial Northwest | Home Bancorp vs. First Capital |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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