Correlation Between United Tennessee and United Overseas
Can any of the company-specific risk be diversified away by investing in both United Tennessee and United Overseas 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 Tennessee and United Overseas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Tennessee Bankshares and United Overseas Bank, you can compare the effects of market volatilities on United Tennessee and United Overseas 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 Tennessee with a short position of United Overseas. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Tennessee and United Overseas.
Diversification Opportunities for United Tennessee and United Overseas
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between United and United is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding United Tennessee Bankshares and United Overseas Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Overseas Bank and United Tennessee 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 Tennessee Bankshares are associated (or correlated) with United Overseas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Overseas Bank has no effect on the direction of United Tennessee i.e., United Tennessee and United Overseas go up and down completely randomly.
Pair Corralation between United Tennessee and United Overseas
If you would invest 4,902 in United Overseas Bank on August 30, 2024 and sell it today you would earn a total of 534.00 from holding United Overseas Bank or generate 10.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
United Tennessee Bankshares vs. United Overseas Bank
Performance |
| Timeline |
| United Tennessee Ban |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| United Overseas Bank |
United Tennessee and United Overseas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Tennessee and United Overseas
The main advantage of trading using opposite United Tennessee and United Overseas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Tennessee position performs unexpectedly, United Overseas 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 United Overseas will offset losses from the drop in United Overseas' long position.| United Tennessee vs. United Bancorporation of | United Tennessee vs. Tri County Financial Group | United Tennessee vs. Quaint Oak Bancorp |
| United Overseas vs. KBC Groep NV | United Overseas vs. DBS Group Holdings | United Overseas vs. HomeStreet | United Overseas vs. Bank of Hawaii |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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