Correlation Between STERLING FINANCIAL and UNITED BANK
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By analyzing existing cross correlation between STERLING FINANCIAL HOLDINGS and UNITED BANK FOR, you can compare the effects of market volatilities on STERLING FINANCIAL and UNITED 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 STERLING FINANCIAL with a short position of UNITED BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of STERLING FINANCIAL and UNITED BANK.
Diversification Opportunities for STERLING FINANCIAL and UNITED BANK
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between STERLING and UNITED is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding STERLING FINANCIAL HOLDINGS and UNITED BANK FOR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED BANK FOR and STERLING 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 STERLING FINANCIAL HOLDINGS are associated (or correlated) with UNITED BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED BANK FOR has no effect on the direction of STERLING FINANCIAL i.e., STERLING FINANCIAL and UNITED BANK go up and down completely randomly.
Pair Corralation between STERLING FINANCIAL and UNITED BANK
Assuming the 90 days trading horizon STERLING FINANCIAL is expected to generate 1.73 times less return on investment than UNITED BANK. But when comparing it to its historical volatility, STERLING FINANCIAL HOLDINGS is 1.08 times less risky than UNITED BANK. It trades about 0.11 of its potential returns per unit of risk. UNITED BANK FOR is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,375 in UNITED BANK FOR on September 4, 2024 and sell it today you would earn a total of 935.00 from holding UNITED BANK FOR or generate 39.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
STERLING FINANCIAL HOLDINGS vs. UNITED BANK FOR
Performance |
| Timeline |
| STERLING FINANCIAL |
| UNITED BANK FOR |
STERLING FINANCIAL and UNITED BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STERLING FINANCIAL and UNITED BANK
The main advantage of trading using opposite STERLING FINANCIAL and UNITED BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STERLING FINANCIAL position performs unexpectedly, UNITED 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 UNITED BANK will offset losses from the drop in UNITED BANK's long position.| STERLING FINANCIAL vs. GUINEA INSURANCE PLC | STERLING FINANCIAL vs. SECURE ELECTRONIC TECHNOLOGY | STERLING FINANCIAL vs. VFD GROUP | STERLING FINANCIAL vs. VETIVA S P |
| UNITED BANK vs. CORONATION INSURANCE PLC | UNITED BANK vs. DN TYRE RUBBER | UNITED BANK vs. AXAMANSARD INSURANCE PLC | UNITED BANK vs. STERLING FINANCIAL HOLDINGS |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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