Correlation Between William Penn and First Republic
Can any of the company-specific risk be diversified away by investing in both William Penn and First Republic 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 William Penn and First Republic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between William Penn Bancorp and First Republic Bank, you can compare the effects of market volatilities on William Penn and First Republic 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 William Penn with a short position of First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of William Penn and First Republic.
Diversification Opportunities for William Penn and First Republic
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between William and First is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding William Penn Bancorp and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank and William Penn 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 William Penn Bancorp are associated (or correlated) with First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of William Penn i.e., William Penn and First Republic go up and down completely randomly.
Pair Corralation between William Penn and First Republic
If you would invest 1,275 in William Penn Bancorp on August 30, 2024 and sell it today you would earn a total of 41.00 from holding William Penn Bancorp or generate 3.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
William Penn Bancorp vs. First Republic Bank
Performance |
| Timeline |
| William Penn Bancorp |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
William Penn and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with William Penn and First Republic
The main advantage of trading using opposite William Penn and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if William Penn position performs unexpectedly, First Republic 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 Republic will offset losses from the drop in First Republic's long position.| William Penn vs. Home Federal Bancorp | William Penn vs. First Financial Northwest | William Penn vs. First Northwest Bancorp | William Penn vs. First Capital |
| First Republic vs. Cincinnati Financial | First Republic vs. Fernhill Beverage | First Republic vs. National Beverage Corp | First Republic vs. QBE Insurance Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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