Correlation Between Trustcash Holdings and First National
Can any of the company-specific risk be diversified away by investing in both Trustcash Holdings and First National 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 Trustcash Holdings and First National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trustcash Holdings and First National of, you can compare the effects of market volatilities on Trustcash Holdings and First National 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 Trustcash Holdings with a short position of First National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trustcash Holdings and First National.
Diversification Opportunities for Trustcash Holdings and First National
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Trustcash and First is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Trustcash Holdings and First National of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First National and Trustcash Holdings 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 Trustcash Holdings are associated (or correlated) with First National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First National has no effect on the direction of Trustcash Holdings i.e., Trustcash Holdings and First National go up and down completely randomly.
Pair Corralation between Trustcash Holdings and First National
Given the investment horizon of 90 days Trustcash Holdings is expected to under-perform the First National. In addition to that, Trustcash Holdings is 9.18 times more volatile than First National of. It trades about -0.13 of its total potential returns per unit of risk. First National of is currently generating about 0.04 per unit of volatility. If you would invest 1,181,388 in First National of on August 24, 2024 and sell it today you would earn a total of 38,612 from holding First National of or generate 3.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Trustcash Holdings vs. First National of
Performance |
| Timeline |
| Trustcash Holdings |
| First National |
Trustcash Holdings and First National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trustcash Holdings and First National
The main advantage of trading using opposite Trustcash Holdings and First National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trustcash Holdings position performs unexpectedly, First National 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 National will offset losses from the drop in First National's long position.The idea behind Trustcash Holdings and First National of pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| First National vs. Washington Business Bank | First National vs. National Capital Bank | First National vs. Community Heritage Financial | First National vs. Citizens Financial Corp |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |