Correlation Between Regions Financial and Peapack Gladstone
Can any of the company-specific risk be diversified away by investing in both Regions Financial and Peapack Gladstone 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 Peapack Gladstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regions Financial and Peapack Gladstone Financial, you can compare the effects of market volatilities on Regions Financial and Peapack Gladstone 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 Peapack Gladstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regions Financial and Peapack Gladstone.
Diversification Opportunities for Regions Financial and Peapack Gladstone
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Regions and Peapack is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Regions Financial and Peapack Gladstone Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peapack Gladstone 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 Peapack Gladstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peapack Gladstone has no effect on the direction of Regions Financial i.e., Regions Financial and Peapack Gladstone go up and down completely randomly.
Pair Corralation between Regions Financial and Peapack Gladstone
Allowing for the 90-day total investment horizon Regions Financial is expected to generate 0.8 times more return on investment than Peapack Gladstone. However, Regions Financial is 1.24 times less risky than Peapack Gladstone. It trades about 0.04 of its potential returns per unit of risk. Peapack Gladstone Financial is currently generating about 0.01 per unit of risk. If you would invest 2,024 in Regions Financial on August 30, 2024 and sell it today you would earn a total of 701.00 from holding Regions Financial or generate 34.63% 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. Peapack Gladstone Financial
Performance |
| Timeline |
| Regions Financial |
| Peapack Gladstone |
Regions Financial and Peapack Gladstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regions Financial and Peapack Gladstone
The main advantage of trading using opposite Regions Financial and Peapack Gladstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regions Financial position performs unexpectedly, Peapack Gladstone 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 Peapack Gladstone will offset losses from the drop in Peapack Gladstone's long position.| Regions Financial vs. SVB T Corp | Regions Financial vs. First Capital | Regions Financial vs. Pioneer Bankcorp | Regions Financial vs. Liberty Northwest Bancorp |
| Peapack Gladstone vs. Sound Financial Bancorp | Peapack Gladstone vs. Finward Bancorp | Peapack Gladstone vs. Franklin Financial Services | Peapack Gladstone 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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