Correlation Between Pinnacle Financial and FB Financial
Can any of the company-specific risk be diversified away by investing in both Pinnacle Financial and FB 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 Pinnacle Financial and FB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pinnacle Financial Partners and FB Financial Corp, you can compare the effects of market volatilities on Pinnacle Financial and FB 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 Pinnacle Financial with a short position of FB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinnacle Financial and FB Financial.
Diversification Opportunities for Pinnacle Financial and FB Financial
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Pinnacle and FBK is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Pinnacle Financial Partners and FB Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FB Financial Corp and Pinnacle 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 Pinnacle Financial Partners are associated (or correlated) with FB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FB Financial Corp has no effect on the direction of Pinnacle Financial i.e., Pinnacle Financial and FB Financial go up and down completely randomly.
Pair Corralation between Pinnacle Financial and FB Financial
Given the investment horizon of 90 days Pinnacle Financial Partners is expected to generate 0.98 times more return on investment than FB Financial. However, Pinnacle Financial Partners is 1.02 times less risky than FB Financial. It trades about 0.27 of its potential returns per unit of risk. FB Financial Corp is currently generating about 0.17 per unit of risk. If you would invest 10,373 in Pinnacle Financial Partners on August 29, 2024 and sell it today you would earn a total of 2,452 from holding Pinnacle Financial Partners or generate 23.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pinnacle Financial Partners vs. FB Financial Corp
Performance |
| Timeline |
| Pinnacle Financial |
| FB Financial Corp |
Pinnacle Financial and FB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinnacle Financial and FB Financial
The main advantage of trading using opposite Pinnacle Financial and FB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinnacle Financial position performs unexpectedly, FB 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 FB Financial will offset losses from the drop in FB Financial's long position.| Pinnacle Financial vs. Wintrust Financial | Pinnacle Financial vs. Renasant | Pinnacle Financial vs. Texas Capital Bancshares | Pinnacle Financial vs. Home BancShares |
| FB Financial vs. Home Bancorp | FB Financial vs. First Business Financial | FB Financial vs. LINKBANCORP | FB Financial vs. Great Southern 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| 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 | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |