Correlation Between Madison County and PNC Financial
Can any of the company-specific risk be diversified away by investing in both Madison County and PNC 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 Madison County and PNC Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Madison County Financial and PNC Financial Services, you can compare the effects of market volatilities on Madison County and PNC 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 Madison County with a short position of PNC Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Madison County and PNC Financial.
Diversification Opportunities for Madison County and PNC Financial
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Madison and PNC is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Madison County Financial and PNC Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PNC Financial Services and Madison County 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 Madison County Financial are associated (or correlated) with PNC Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PNC Financial Services has no effect on the direction of Madison County i.e., Madison County and PNC Financial go up and down completely randomly.
Pair Corralation between Madison County and PNC Financial
If you would invest 15,226 in PNC Financial Services on September 1, 2024 and sell it today you would earn a total of 6,246 from holding PNC Financial Services or generate 41.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.79% |
| Values | Daily Returns |
Madison County Financial vs. PNC Financial Services
Performance |
| Timeline |
| Madison County Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| PNC Financial Services |
Madison County and PNC Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Madison County and PNC Financial
The main advantage of trading using opposite Madison County and PNC Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Madison County position performs unexpectedly, PNC 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 PNC Financial will offset losses from the drop in PNC Financial's long position.| Madison County vs. Bank of San | Madison County vs. Citizens Bancorp of | Madison County vs. First Ottawa Bancshares | Madison County vs. Mountain Commerce Bancorp |
| PNC Financial vs. Truist Financial Corp | PNC Financial vs. KeyCorp | PNC Financial vs. Western Alliance Bancorporation | PNC Financial vs. Zions Bancorporation |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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