Correlation Between United Bankshares and Equity Bancshares,
Can any of the company-specific risk be diversified away by investing in both United Bankshares and Equity Bancshares, 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 United Bankshares and Equity Bancshares, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Bankshares and Equity Bancshares,, you can compare the effects of market volatilities on United Bankshares and Equity Bancshares, 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 United Bankshares with a short position of Equity Bancshares,. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Bankshares and Equity Bancshares,.
Diversification Opportunities for United Bankshares and Equity Bancshares,
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between United and Equity is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding United Bankshares and Equity Bancshares, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equity Bancshares, and United Bankshares 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 United Bankshares are associated (or correlated) with Equity Bancshares,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equity Bancshares, has no effect on the direction of United Bankshares i.e., United Bankshares and Equity Bancshares, go up and down completely randomly.
Pair Corralation between United Bankshares and Equity Bancshares,
Given the investment horizon of 90 days United Bankshares is expected to generate 1.17 times more return on investment than Equity Bancshares,. However, United Bankshares is 1.17 times more volatile than Equity Bancshares,. It trades about 0.19 of its potential returns per unit of risk. Equity Bancshares, is currently generating about 0.23 per unit of risk. If you would invest 3,845 in United Bankshares on August 28, 2024 and sell it today you would earn a total of 484.00 from holding United Bankshares or generate 12.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Bankshares vs. Equity Bancshares,
Performance |
| Timeline |
| United Bankshares |
| Equity Bancshares, |
United Bankshares and Equity Bancshares, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Bankshares and Equity Bancshares,
The main advantage of trading using opposite United Bankshares and Equity Bancshares, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Bankshares position performs unexpectedly, Equity Bancshares, 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 Equity Bancshares, will offset losses from the drop in Equity Bancshares,'s long position.| United Bankshares vs. Peoples Bancorp | United Bankshares vs. Eagle Bancorp | United Bankshares vs. Northrim BanCorp | United Bankshares vs. Pacific Premier Bancorp |
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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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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