Correlation Between Hancock Whitney and United Overseas
Can any of the company-specific risk be diversified away by investing in both Hancock Whitney and United Overseas 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 United Overseas 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 United Overseas Bank, you can compare the effects of market volatilities on Hancock Whitney and United Overseas 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 United Overseas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hancock Whitney and United Overseas.
Diversification Opportunities for Hancock Whitney and United Overseas
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hancock and United is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Hancock Whitney Corp and United Overseas Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Overseas Bank 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 United Overseas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Overseas Bank has no effect on the direction of Hancock Whitney i.e., Hancock Whitney and United Overseas go up and down completely randomly.
Pair Corralation between Hancock Whitney and United Overseas
Considering the 90-day investment horizon Hancock Whitney Corp is expected to generate 2.16 times more return on investment than United Overseas. However, Hancock Whitney is 2.16 times more volatile than United Overseas Bank. It trades about 0.18 of its potential returns per unit of risk. United Overseas Bank is currently generating about 0.27 per unit of risk. If you would invest 5,250 in Hancock Whitney Corp on August 30, 2024 and sell it today you would earn a total of 784.00 from holding Hancock Whitney Corp or generate 14.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hancock Whitney Corp vs. United Overseas Bank
Performance |
| Timeline |
| Hancock Whitney Corp |
| United Overseas Bank |
Hancock Whitney and United Overseas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hancock Whitney and United Overseas
The main advantage of trading using opposite Hancock Whitney and United Overseas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hancock Whitney position performs unexpectedly, United Overseas 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 United Overseas will offset losses from the drop in United Overseas' long position.| Hancock Whitney vs. Home Bancorp | Hancock Whitney vs. First Business Financial | Hancock Whitney vs. LINKBANCORP | Hancock Whitney vs. Great Southern Bancorp |
| United Overseas vs. KBC Groep NV | United Overseas vs. DBS Group Holdings | United Overseas vs. HomeStreet | United Overseas vs. Bank of Hawaii |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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