Correlation Between Regions Financial and Univest Pennsylvania
Can any of the company-specific risk be diversified away by investing in both Regions Financial and Univest Pennsylvania 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 Univest Pennsylvania into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regions Financial and Univest Pennsylvania, you can compare the effects of market volatilities on Regions Financial and Univest Pennsylvania 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 Univest Pennsylvania. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regions Financial and Univest Pennsylvania.
Diversification Opportunities for Regions Financial and Univest Pennsylvania
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Regions and Univest is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Regions Financial and Univest Pennsylvania in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Univest Pennsylvania 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 Univest Pennsylvania. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Univest Pennsylvania has no effect on the direction of Regions Financial i.e., Regions Financial and Univest Pennsylvania go up and down completely randomly.
Pair Corralation between Regions Financial and Univest Pennsylvania
Allowing for the 90-day total investment horizon Regions Financial is expected to generate 1.08 times less return on investment than Univest Pennsylvania. But when comparing it to its historical volatility, Regions Financial is 1.26 times less risky than Univest Pennsylvania. It trades about 0.21 of its potential returns per unit of risk. Univest Pennsylvania is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 2,716 in Univest Pennsylvania on August 23, 2024 and sell it today you would earn a total of 376.00 from holding Univest Pennsylvania or generate 13.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regions Financial vs. Univest Pennsylvania
Performance |
| Timeline |
| Regions Financial |
| Univest Pennsylvania |
Regions Financial and Univest Pennsylvania Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regions Financial and Univest Pennsylvania
The main advantage of trading using opposite Regions Financial and Univest Pennsylvania positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regions Financial position performs unexpectedly, Univest Pennsylvania 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 Univest Pennsylvania will offset losses from the drop in Univest Pennsylvania's long position.| Regions Financial vs. Waterstone Financial | Regions Financial vs. Mid Penn Bancorp | Regions Financial vs. ST Bancorp | Regions Financial vs. Republic Bancorp |
| Univest Pennsylvania vs. Waterstone Financial | Univest Pennsylvania vs. Mid Penn Bancorp | Univest Pennsylvania vs. ST Bancorp | Univest Pennsylvania vs. Republic 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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