Correlation Between National Bank and Heartland Financial
Can any of the company-specific risk be diversified away by investing in both National Bank and Heartland 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 National Bank and Heartland Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank Holdings and Heartland Financial USA, you can compare the effects of market volatilities on National Bank and Heartland 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 National Bank with a short position of Heartland Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Heartland Financial.
Diversification Opportunities for National Bank and Heartland Financial
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between National and Heartland is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding National Bank Holdings and Heartland Financial USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heartland Financial USA and National Bank 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 National Bank Holdings are associated (or correlated) with Heartland Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heartland Financial USA has no effect on the direction of National Bank i.e., National Bank and Heartland Financial go up and down completely randomly.
Pair Corralation between National Bank and Heartland Financial
Assuming the 90 days horizon National Bank Holdings is expected to generate 1.42 times more return on investment than Heartland Financial. However, National Bank is 1.42 times more volatile than Heartland Financial USA. It trades about -0.1 of its potential returns per unit of risk. Heartland Financial USA is currently generating about -0.58 per unit of risk. If you would invest 3,991 in National Bank Holdings on December 1, 2024 and sell it today you would lose (119.00) from holding National Bank Holdings or give up 2.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 13.64% |
| Values | Daily Returns |
National Bank Holdings vs. Heartland Financial USA
Performance |
| Timeline |
| National Bank Holdings |
| Heartland Financial USA |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
National Bank and Heartland Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Heartland Financial
The main advantage of trading using opposite National Bank and Heartland Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Heartland 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 Heartland Financial will offset losses from the drop in Heartland Financial's long position.| National Bank vs. Japan Asia Investment | National Bank vs. Siamgas And Petrochemicals | National Bank vs. China BlueChemical | National Bank vs. PennyMac Mortgage Investment |
| Heartland Financial vs. POSBO UNSPADRS20YC1 | Heartland Financial vs. Postal Savings Bank | Heartland Financial vs. Truist Financial | Heartland Financial vs. OVERSEA CHINUNSPADR2 |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |