Correlation Between Woori Financial and First National
Can any of the company-specific risk be diversified away by investing in both Woori Financial 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 Woori Financial and First National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and First National Corp, you can compare the effects of market volatilities on Woori Financial 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 Woori Financial with a short position of First National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and First National.
Diversification Opportunities for Woori Financial and First National
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and First is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and First National Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First National Corp and Woori 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 Woori Financial Group 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 Corp has no effect on the direction of Woori Financial i.e., Woori Financial and First National go up and down completely randomly.
Pair Corralation between Woori Financial and First National
Allowing for the 90-day total investment horizon Woori Financial is expected to generate 6.27 times less return on investment than First National. But when comparing it to its historical volatility, Woori Financial Group is 1.7 times less risky than First National. It trades about 0.1 of its potential returns per unit of risk. First National Corp is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 2,100 in First National Corp on August 30, 2024 and sell it today you would earn a total of 378.00 from holding First National Corp or generate 18.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. First National Corp
Performance |
| Timeline |
| Woori Financial Group |
| First National Corp |
Woori Financial and First National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and First National
The main advantage of trading using opposite Woori Financial and First National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial 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.| Woori Financial vs. JPMorgan Chase Co | Woori Financial vs. Citigroup | Woori Financial vs. Wells Fargo | Woori Financial vs. Toronto Dominion Bank |
| First National vs. Home Federal Bancorp | First National vs. Lake Shore Bancorp | First National vs. Oak Valley Bancorp | First National vs. Community West Bancshares |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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