Correlation Between SVB Financial and Signature Bank
Can any of the company-specific risk be diversified away by investing in both SVB Financial and Signature Bank 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 SVB Financial and Signature Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SVB Financial Group and Signature Bank, you can compare the effects of market volatilities on SVB Financial and Signature Bank 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 SVB Financial with a short position of Signature Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of SVB Financial and Signature Bank.
Diversification Opportunities for SVB Financial and Signature Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SVB and Signature is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SVB Financial Group and Signature Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Signature Bank and SVB 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 SVB Financial Group are associated (or correlated) with Signature Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Signature Bank has no effect on the direction of SVB Financial i.e., SVB Financial and Signature Bank go up and down completely randomly.
Pair Corralation between SVB Financial and Signature Bank
If you would invest 2.50 in Signature Bank on August 29, 2024 and sell it today you would lose (0.80) from holding Signature Bank or give up 32.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
SVB Financial Group vs. Signature Bank
Performance |
| Timeline |
| SVB Financial Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Signature Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SVB Financial and Signature Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SVB Financial and Signature Bank
The main advantage of trading using opposite SVB Financial and Signature Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SVB Financial position performs unexpectedly, Signature Bank 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 Signature Bank will offset losses from the drop in Signature Bank's long position.| SVB Financial vs. Procter Gamble | SVB Financial vs. Hooker Furniture | SVB Financial vs. JBG SMITH Properties | SVB Financial vs. Inter Parfums |
| Signature Bank vs. Braskem SA Class | Signature Bank vs. Organic Sales and | Signature Bank vs. Ecolab Inc | Signature Bank vs. The Mosaic |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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