Correlation Between KBC Groep and Hancock Whitney
Can any of the company-specific risk be diversified away by investing in both KBC Groep and Hancock Whitney 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 KBC Groep and Hancock Whitney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KBC Groep NV and Hancock Whitney Corp, you can compare the effects of market volatilities on KBC Groep and Hancock Whitney 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 KBC Groep with a short position of Hancock Whitney. Check out your portfolio center. Please also check ongoing floating volatility patterns of KBC Groep and Hancock Whitney.
Diversification Opportunities for KBC Groep and Hancock Whitney
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KBC and Hancock is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding KBC Groep NV and Hancock Whitney Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hancock Whitney Corp and KBC Groep 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 KBC Groep NV are associated (or correlated) with Hancock Whitney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hancock Whitney Corp has no effect on the direction of KBC Groep i.e., KBC Groep and Hancock Whitney go up and down completely randomly.
Pair Corralation between KBC Groep and Hancock Whitney
Assuming the 90 days horizon KBC Groep NV is expected to under-perform the Hancock Whitney. But the pink sheet apears to be less risky and, when comparing its historical volatility, KBC Groep NV is 2.57 times less risky than Hancock Whitney. The pink sheet trades about -0.04 of its potential returns per unit of risk. The Hancock Whitney Corp is currently generating about 0.18 of returns per unit of risk over similar time horizon. 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 Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KBC Groep NV vs. Hancock Whitney Corp
Performance |
| Timeline |
| KBC Groep NV |
| Hancock Whitney Corp |
KBC Groep and Hancock Whitney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KBC Groep and Hancock Whitney
The main advantage of trading using opposite KBC Groep and Hancock Whitney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KBC Groep position performs unexpectedly, Hancock Whitney 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 Hancock Whitney will offset losses from the drop in Hancock Whitney's long position.The idea behind KBC Groep NV and Hancock Whitney Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Hancock Whitney vs. Home Bancorp | Hancock Whitney vs. First Business Financial | Hancock Whitney vs. LINKBANCORP | Hancock Whitney vs. Great Southern Bancorp |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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