Correlation Between PNC Financial and First Capital
Can any of the company-specific risk be diversified away by investing in both PNC Financial and First Capital 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 First Capital 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 First Capital, you can compare the effects of market volatilities on PNC Financial and First Capital 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 First Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of PNC Financial and First Capital.
Diversification Opportunities for PNC Financial and First Capital
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between PNC and First is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding PNC Financial Services and First Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Capital 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 First Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Capital has no effect on the direction of PNC Financial i.e., PNC Financial and First Capital go up and down completely randomly.
Pair Corralation between PNC Financial and First Capital
Considering the 90-day investment horizon PNC Financial Services is expected to generate 1.17 times more return on investment than First Capital. However, PNC Financial is 1.17 times more volatile than First Capital. It trades about 0.3 of its potential returns per unit of risk. First Capital is currently generating about -0.34 per unit of risk. If you would invest 18,785 in PNC Financial Services on August 30, 2024 and sell it today you would earn a total of 2,715 from holding PNC Financial Services or generate 14.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PNC Financial Services vs. First Capital
Performance |
| Timeline |
| PNC Financial Services |
| First Capital |
PNC Financial and First Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PNC Financial and First Capital
The main advantage of trading using opposite PNC Financial and First Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PNC Financial position performs unexpectedly, First Capital 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 Capital will offset losses from the drop in First Capital's long position.| PNC Financial vs. Truist Financial Corp | PNC Financial vs. KeyCorp | PNC Financial vs. Western Alliance Bancorporation | PNC Financial vs. Zions Bancorporation |
| First Capital vs. Home Federal Bancorp | First Capital vs. First Financial Northwest | First Capital vs. First Northwest Bancorp | First Capital vs. Community West Bancshares |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Commodity Directory Find actively traded commodities issued by global exchanges |