Correlation Between Regions Financial and ChoiceOne Financial
Can any of the company-specific risk be diversified away by investing in both Regions Financial and ChoiceOne 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 Regions Financial and ChoiceOne Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regions Financial and ChoiceOne Financial Services, you can compare the effects of market volatilities on Regions Financial and ChoiceOne 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 Regions Financial with a short position of ChoiceOne Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regions Financial and ChoiceOne Financial.
Diversification Opportunities for Regions Financial and ChoiceOne Financial
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Regions and ChoiceOne is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Regions Financial and ChoiceOne Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChoiceOne Financial and Regions 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 Regions Financial are associated (or correlated) with ChoiceOne Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChoiceOne Financial has no effect on the direction of Regions Financial i.e., Regions Financial and ChoiceOne Financial go up and down completely randomly.
Pair Corralation between Regions Financial and ChoiceOne Financial
Allowing for the 90-day total investment horizon Regions Financial is expected to generate 1.34 times more return on investment than ChoiceOne Financial. However, Regions Financial is 1.34 times more volatile than ChoiceOne Financial Services. It trades about 0.24 of its potential returns per unit of risk. ChoiceOne Financial Services is currently generating about 0.25 per unit of risk. If you would invest 2,406 in Regions Financial on August 28, 2024 and sell it today you would earn a total of 341.00 from holding Regions Financial or generate 14.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regions Financial vs. ChoiceOne Financial Services
Performance |
| Timeline |
| Regions Financial |
| ChoiceOne Financial |
Regions Financial and ChoiceOne Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regions Financial and ChoiceOne Financial
The main advantage of trading using opposite Regions Financial and ChoiceOne Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regions Financial position performs unexpectedly, ChoiceOne 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 ChoiceOne Financial will offset losses from the drop in ChoiceOne Financial's long position.| Regions Financial vs. KeyCorp | Regions Financial vs. Fifth Third Bancorp | Regions Financial vs. Zions Bancorporation | Regions Financial vs. Huntington Bancshares Incorporated |
| ChoiceOne Financial vs. Fifth Third Bancorp | ChoiceOne Financial vs. Zions Bancorporation | ChoiceOne Financial vs. Huntington Bancshares Incorporated | ChoiceOne Financial vs. Comerica |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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