Correlation Between Tectonic Financial and FirstSun Capital
Can any of the company-specific risk be diversified away by investing in both Tectonic Financial and FirstSun Capital 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 Tectonic Financial and FirstSun Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tectonic Financial PR and FirstSun Capital Bancorp, you can compare the effects of market volatilities on Tectonic Financial and FirstSun Capital 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 Tectonic Financial with a short position of FirstSun Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tectonic Financial and FirstSun Capital.
Diversification Opportunities for Tectonic Financial and FirstSun Capital
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tectonic and FirstSun is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Tectonic Financial PR and FirstSun Capital Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FirstSun Capital Bancorp and Tectonic 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 Tectonic Financial PR are associated (or correlated) with FirstSun Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FirstSun Capital Bancorp has no effect on the direction of Tectonic Financial i.e., Tectonic Financial and FirstSun Capital go up and down completely randomly.
Pair Corralation between Tectonic Financial and FirstSun Capital
Assuming the 90 days horizon Tectonic Financial PR is expected to generate 0.51 times more return on investment than FirstSun Capital. However, Tectonic Financial PR is 1.96 times less risky than FirstSun Capital. It trades about 0.07 of its potential returns per unit of risk. FirstSun Capital Bancorp is currently generating about -0.11 per unit of risk. If you would invest 1,015 in Tectonic Financial PR on August 27, 2024 and sell it today you would earn a total of 17.00 from holding Tectonic Financial PR or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tectonic Financial PR vs. FirstSun Capital Bancorp
Performance |
| Timeline |
| Tectonic Financial |
| FirstSun Capital Bancorp |
Tectonic Financial and FirstSun Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tectonic Financial and FirstSun Capital
The main advantage of trading using opposite Tectonic Financial and FirstSun Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tectonic Financial position performs unexpectedly, FirstSun Capital 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 FirstSun Capital will offset losses from the drop in FirstSun Capital's long position.| Tectonic Financial vs. First Guaranty Bancshares | Tectonic Financial vs. First Merchants | Tectonic Financial vs. Associated Banc Corp | Tectonic Financial vs. Absa Group Limited |
| FirstSun Capital vs. Prime Meridian Holding | FirstSun Capital vs. William Penn Bancorp | FirstSun Capital vs. Pathfinder Bancorp | FirstSun Capital vs. Enterprise Financial Services |
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.
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