Correlation Between Marquette National and First Hawaiian
Can any of the company-specific risk be diversified away by investing in both Marquette National and First Hawaiian 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 Marquette National and First Hawaiian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marquette National Corp and First Hawaiian, you can compare the effects of market volatilities on Marquette National and First Hawaiian 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 Marquette National with a short position of First Hawaiian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marquette National and First Hawaiian.
Diversification Opportunities for Marquette National and First Hawaiian
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Marquette and First is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Marquette National Corp and First Hawaiian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Hawaiian and Marquette National 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 Marquette National Corp are associated (or correlated) with First Hawaiian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Hawaiian has no effect on the direction of Marquette National i.e., Marquette National and First Hawaiian go up and down completely randomly.
Pair Corralation between Marquette National and First Hawaiian
Given the investment horizon of 90 days Marquette National is expected to generate 1.52 times less return on investment than First Hawaiian. In addition to that, Marquette National is 2.71 times more volatile than First Hawaiian. It trades about 0.01 of its total potential returns per unit of risk. First Hawaiian is currently generating about 0.05 per unit of volatility. If you would invest 2,727 in First Hawaiian on September 13, 2024 and sell it today you would earn a total of 20.00 from holding First Hawaiian or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marquette National Corp vs. First Hawaiian
Performance |
| Timeline |
| Marquette National Corp |
| First Hawaiian |
Marquette National and First Hawaiian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marquette National and First Hawaiian
The main advantage of trading using opposite Marquette National and First Hawaiian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marquette National position performs unexpectedly, First Hawaiian 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 First Hawaiian will offset losses from the drop in First Hawaiian's long position.| Marquette National vs. PT Bank Rakyat | Marquette National vs. Morningstar Unconstrained Allocation | Marquette National vs. Bondbloxx ETF Trust | Marquette National vs. Spring Valley Acquisition |
| First Hawaiian vs. Territorial Bancorp | First Hawaiian vs. Bank of Hawaii | First Hawaiian vs. Financial Institutions | First Hawaiian vs. Heritage Financial |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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