Correlation Between Hancock Whitney and Valley National
Can any of the company-specific risk be diversified away by investing in both Hancock Whitney and Valley National 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 Valley National 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 Valley National Bancorp, you can compare the effects of market volatilities on Hancock Whitney and Valley National 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 Valley National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hancock Whitney and Valley National.
Diversification Opportunities for Hancock Whitney and Valley National
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hancock and Valley is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Hancock Whitney Corp and Valley National Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valley National 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 Valley National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valley National Bancorp has no effect on the direction of Hancock Whitney i.e., Hancock Whitney and Valley National go up and down completely randomly.
Pair Corralation between Hancock Whitney and Valley National
Considering the 90-day investment horizon Hancock Whitney Corp is expected to generate 1.4 times more return on investment than Valley National. However, Hancock Whitney is 1.4 times more volatile than Valley National Bancorp. It trades about 0.2 of its potential returns per unit of risk. Valley National Bancorp is currently generating about 0.24 per unit of risk. If you would invest 5,139 in Hancock Whitney Corp on September 3, 2024 and sell it today you would earn a total of 799.00 from holding Hancock Whitney Corp or generate 15.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hancock Whitney Corp vs. Valley National Bancorp
Performance |
| Timeline |
| Hancock Whitney Corp |
| Valley National Bancorp |
Hancock Whitney and Valley National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hancock Whitney and Valley National
The main advantage of trading using opposite Hancock Whitney and Valley National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hancock Whitney position performs unexpectedly, Valley National 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 Valley National will offset losses from the drop in Valley National's long position.| Hancock Whitney vs. Home Bancorp | Hancock Whitney vs. First Business Financial | Hancock Whitney vs. LINKBANCORP | Hancock Whitney vs. Great Southern Bancorp |
| Valley National vs. Fulton Financial | Valley National vs. Webster Financial | Valley National vs. United Bankshares | Valley National vs. FNB Corp |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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