Correlation Between Regions Financial and ITALIAN WINE
Can any of the company-specific risk be diversified away by investing in both Regions Financial and ITALIAN WINE 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 ITALIAN WINE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regions Financial and ITALIAN WINE BRANDS, you can compare the effects of market volatilities on Regions Financial and ITALIAN WINE 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 ITALIAN WINE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regions Financial and ITALIAN WINE.
Diversification Opportunities for Regions Financial and ITALIAN WINE
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Regions and ITALIAN is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Regions Financial and ITALIAN WINE BRANDS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITALIAN WINE BRANDS 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 ITALIAN WINE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITALIAN WINE BRANDS has no effect on the direction of Regions Financial i.e., Regions Financial and ITALIAN WINE go up and down completely randomly.
Pair Corralation between Regions Financial and ITALIAN WINE
Assuming the 90 days horizon Regions Financial is expected to generate 0.93 times more return on investment than ITALIAN WINE. However, Regions Financial is 1.08 times less risky than ITALIAN WINE. It trades about 0.11 of its potential returns per unit of risk. ITALIAN WINE BRANDS is currently generating about 0.04 per unit of risk. If you would invest 1,752 in Regions Financial on September 23, 2024 and sell it today you would earn a total of 468.00 from holding Regions Financial or generate 26.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regions Financial vs. ITALIAN WINE BRANDS
Performance |
| Timeline |
| Regions Financial |
| ITALIAN WINE BRANDS |
Regions Financial and ITALIAN WINE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regions Financial and ITALIAN WINE
The main advantage of trading using opposite Regions Financial and ITALIAN WINE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regions Financial position performs unexpectedly, ITALIAN WINE 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 ITALIAN WINE will offset losses from the drop in ITALIAN WINE's long position.| Regions Financial vs. The PNC Financial | Regions Financial vs. MT Bank Corp | Regions Financial vs. Huntington Bancshares Incorporated | Regions Financial vs. Citizens Financial Group |
| ITALIAN WINE vs. Webster Financial | ITALIAN WINE vs. Tradegate AG Wertpapierhandelsbank | ITALIAN WINE vs. Regions Financial | ITALIAN WINE vs. CHIBA BANK |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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