Correlation Between William Penn and Signature Bank
Can any of the company-specific risk be diversified away by investing in both William Penn and Signature Bank 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 Signature Bank 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 Signature Bank, you can compare the effects of market volatilities on William Penn and Signature Bank 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 Signature Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of William Penn and Signature Bank.
Diversification Opportunities for William Penn and Signature Bank
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between William and Signature is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding William Penn Bancorp and Signature Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Signature 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 Signature Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Signature Bank has no effect on the direction of William Penn i.e., William Penn and Signature Bank go up and down completely randomly.
Pair Corralation between William Penn and Signature Bank
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. Signature Bank
Performance |
| Timeline |
| William Penn Bancorp |
| Signature Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
William Penn and Signature Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with William Penn and Signature Bank
The main advantage of trading using opposite William Penn and Signature Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if William Penn position performs unexpectedly, Signature Bank 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 Signature Bank will offset losses from the drop in Signature Bank'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 |
| Signature Bank vs. PennantPark Floating Rate | Signature Bank vs. GMS Inc | Signature Bank vs. Stepstone Group | Signature Bank vs. Griffon |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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