Correlation Between PNC Financial and Bank First
Can any of the company-specific risk be diversified away by investing in both PNC Financial and Bank First 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 PNC Financial and Bank First into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PNC Financial Services and Bank First National, you can compare the effects of market volatilities on PNC Financial and Bank First 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 PNC Financial with a short position of Bank First. Check out your portfolio center. Please also check ongoing floating volatility patterns of PNC Financial and Bank First.
Diversification Opportunities for PNC Financial and Bank First
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between PNC and Bank is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding PNC Financial Services and Bank First National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank First National and PNC Financial 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 PNC Financial Services are associated (or correlated) with Bank First. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank First National has no effect on the direction of PNC Financial i.e., PNC Financial and Bank First go up and down completely randomly.
Pair Corralation between PNC Financial and Bank First
Considering the 90-day investment horizon PNC Financial Services is expected to generate 0.65 times more return on investment than Bank First. However, PNC Financial Services is 1.54 times less risky than Bank First. It trades about 0.16 of its potential returns per unit of risk. Bank First National is currently generating about 0.09 per unit of risk. If you would invest 18,152 in PNC Financial Services on August 29, 2024 and sell it today you would earn a total of 3,268 from holding PNC Financial Services or generate 18.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PNC Financial Services vs. Bank First National
Performance |
| Timeline |
| PNC Financial Services |
| Bank First National |
PNC Financial and Bank First Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PNC Financial and Bank First
The main advantage of trading using opposite PNC Financial and Bank First positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PNC Financial position performs unexpectedly, Bank First 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 Bank First will offset losses from the drop in Bank First's long position.| PNC Financial vs. Truist Financial Corp | PNC Financial vs. KeyCorp | PNC Financial vs. Western Alliance Bancorporation | PNC Financial vs. Zions Bancorporation |
| Bank First vs. Norwood Financial Corp | Bank First vs. Chemung Financial Corp | Bank First vs. Home Federal Bancorp | Bank First vs. Rhinebeck 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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