Correlation Between Pinnacle Financial and Old National
Can any of the company-specific risk be diversified away by investing in both Pinnacle Financial and Old National 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 Old National 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 Old National Bancorp, you can compare the effects of market volatilities on Pinnacle Financial and Old National 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 Old National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinnacle Financial and Old National.
Diversification Opportunities for Pinnacle Financial and Old National
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pinnacle and Old is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Pinnacle Financial Partners and Old National Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old National Bancorp 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 Old National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old National Bancorp has no effect on the direction of Pinnacle Financial i.e., Pinnacle Financial and Old National go up and down completely randomly.
Pair Corralation between Pinnacle Financial and Old National
Assuming the 90 days horizon Pinnacle Financial Partners is expected to generate 0.71 times more return on investment than Old National. However, Pinnacle Financial Partners is 1.4 times less risky than Old National. It trades about 0.16 of its potential returns per unit of risk. Old National Bancorp is currently generating about 0.11 per unit of risk. If you would invest 2,438 in Pinnacle Financial Partners on August 24, 2024 and sell it today you would earn a total of 47.00 from holding Pinnacle Financial Partners or generate 1.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Pinnacle Financial Partners vs. Old National Bancorp
Performance |
| Timeline |
| Pinnacle Financial |
| Old National Bancorp |
Pinnacle Financial and Old National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pinnacle Financial and Old National
The main advantage of trading using opposite Pinnacle Financial and Old National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinnacle Financial position performs unexpectedly, Old National 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 Old National will offset losses from the drop in Old National's long position.| Pinnacle Financial vs. Capital One Financial | Pinnacle Financial vs. Capital One Financial | Pinnacle Financial vs. Bank of America | Pinnacle Financial vs. KeyCorp |
| Old National vs. Old National Bancorp | Old National vs. Pinnacle Financial Partners | Old National vs. Heartland Financial USA | Old National vs. OceanFirst Financial Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |