Correlation Between Truist Financial and Fulton Financial
Can any of the company-specific risk be diversified away by investing in both Truist Financial and Fulton Financial 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 Truist Financial and Fulton Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truist Financial and Fulton Financial, you can compare the effects of market volatilities on Truist Financial and Fulton Financial 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 Truist Financial with a short position of Fulton Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truist Financial and Fulton Financial.
Diversification Opportunities for Truist Financial and Fulton Financial
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Truist and Fulton is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Truist Financial and Fulton Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fulton Financial and Truist 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 Truist Financial are associated (or correlated) with Fulton Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fulton Financial has no effect on the direction of Truist Financial i.e., Truist Financial and Fulton Financial go up and down completely randomly.
Pair Corralation between Truist Financial and Fulton Financial
Assuming the 90 days trading horizon Truist Financial is expected to under-perform the Fulton Financial. But the preferred stock apears to be less risky and, when comparing its historical volatility, Truist Financial is 3.55 times less risky than Fulton Financial. The preferred stock trades about -0.07 of its potential returns per unit of risk. The Fulton Financial is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,817 in Fulton Financial on August 27, 2024 and sell it today you would earn a total of 344.00 from holding Fulton Financial or generate 18.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Truist Financial vs. Fulton Financial
Performance |
| Timeline |
| Truist Financial |
| Fulton Financial |
Truist Financial and Fulton Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truist Financial and Fulton Financial
The main advantage of trading using opposite Truist Financial and Fulton Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truist Financial position performs unexpectedly, Fulton Financial 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 Fulton Financial will offset losses from the drop in Fulton Financial's long position.| Truist Financial vs. Truist Financial | Truist Financial vs. Truist Financial | Truist Financial vs. US Bancorp | Truist Financial vs. MetLife Preferred Stock |
| Fulton Financial vs. First Commonwealth Financial | Fulton Financial vs. Heritage Commerce Corp | Fulton Financial vs. Northwest Bancshares | Fulton Financial vs. First United |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |