Correlation Between PacWest Bancorp and DBS Group
Can any of the company-specific risk be diversified away by investing in both PacWest Bancorp and DBS Group 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 PacWest Bancorp and DBS Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PacWest Bancorp and DBS Group Holdings, you can compare the effects of market volatilities on PacWest Bancorp and DBS Group 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 PacWest Bancorp with a short position of DBS Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of PacWest Bancorp and DBS Group.
Diversification Opportunities for PacWest Bancorp and DBS Group
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PacWest and DBS is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding PacWest Bancorp and DBS Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBS Group Holdings and PacWest Bancorp 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 PacWest Bancorp are associated (or correlated) with DBS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBS Group Holdings has no effect on the direction of PacWest Bancorp i.e., PacWest Bancorp and DBS Group go up and down completely randomly.
Pair Corralation between PacWest Bancorp and DBS Group
If you would invest 3,014 in DBS Group Holdings on August 26, 2024 and sell it today you would earn a total of 275.00 from holding DBS Group Holdings or generate 9.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
PacWest Bancorp vs. DBS Group Holdings
Performance |
| Timeline |
| PacWest Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| DBS Group Holdings |
PacWest Bancorp and DBS Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PacWest Bancorp and DBS Group
The main advantage of trading using opposite PacWest Bancorp and DBS Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PacWest Bancorp position performs unexpectedly, DBS Group 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 DBS Group will offset losses from the drop in DBS Group's long position.| PacWest Bancorp vs. Zions Bancorporation | PacWest Bancorp vs. KeyCorp | PacWest Bancorp vs. Comerica | PacWest Bancorp vs. First Horizon National |
| DBS Group vs. United Overseas Bank | DBS Group vs. KBC Groep NV | DBS Group vs. Overseas Chinese Banking | DBS Group vs. China Minsh |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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