Correlation Between Swedbank and First Hawaiian
Can any of the company-specific risk be diversified away by investing in both Swedbank and First Hawaiian 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 Swedbank and First Hawaiian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swedbank AB and First Hawaiian, you can compare the effects of market volatilities on Swedbank and First Hawaiian 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 Swedbank with a short position of First Hawaiian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swedbank and First Hawaiian.
Diversification Opportunities for Swedbank and First Hawaiian
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swedbank and First is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Swedbank AB and First Hawaiian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Hawaiian and Swedbank 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 Swedbank AB are associated (or correlated) with First Hawaiian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Hawaiian has no effect on the direction of Swedbank i.e., Swedbank and First Hawaiian go up and down completely randomly.
Pair Corralation between Swedbank and First Hawaiian
Assuming the 90 days horizon Swedbank is expected to generate 3.19 times less return on investment than First Hawaiian. In addition to that, Swedbank is 1.12 times more volatile than First Hawaiian. It trades about 0.02 of its total potential returns per unit of risk. First Hawaiian is currently generating about 0.07 per unit of volatility. If you would invest 2,173 in First Hawaiian on September 12, 2024 and sell it today you would earn a total of 605.00 from holding First Hawaiian or generate 27.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.32% |
| Values | Daily Returns |
Swedbank AB vs. First Hawaiian
Performance |
| Timeline |
| Swedbank AB |
| First Hawaiian |
Swedbank and First Hawaiian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swedbank and First Hawaiian
The main advantage of trading using opposite Swedbank and First Hawaiian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swedbank position performs unexpectedly, First Hawaiian 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 First Hawaiian will offset losses from the drop in First Hawaiian's long position.| Swedbank vs. PT Bank Rakyat | Swedbank vs. Morningstar Unconstrained Allocation | Swedbank vs. Bondbloxx ETF Trust | Swedbank vs. Spring Valley Acquisition |
| First Hawaiian vs. Territorial Bancorp | First Hawaiian vs. Bank of Hawaii | First Hawaiian vs. Financial Institutions | First Hawaiian vs. Heritage Financial |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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