Correlation Between Waterstone Financial and OneMain Holdings
Can any of the company-specific risk be diversified away by investing in both Waterstone Financial and OneMain Holdings 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 Waterstone Financial and OneMain Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Waterstone Financial and OneMain Holdings, you can compare the effects of market volatilities on Waterstone Financial and OneMain Holdings 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 Waterstone Financial with a short position of OneMain Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Waterstone Financial and OneMain Holdings.
Diversification Opportunities for Waterstone Financial and OneMain Holdings
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Waterstone and OneMain is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Waterstone Financial and OneMain Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneMain Holdings and Waterstone 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 Waterstone Financial are associated (or correlated) with OneMain Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneMain Holdings has no effect on the direction of Waterstone Financial i.e., Waterstone Financial and OneMain Holdings go up and down completely randomly.
Pair Corralation between Waterstone Financial and OneMain Holdings
Given the investment horizon of 90 days Waterstone Financial is expected to generate 1.3 times more return on investment than OneMain Holdings. However, Waterstone Financial is 1.3 times more volatile than OneMain Holdings. It trades about 0.11 of its potential returns per unit of risk. OneMain Holdings is currently generating about -0.16 per unit of risk. If you would invest 1,350 in Waterstone Financial on November 27, 2024 and sell it today you would earn a total of 69.00 from holding Waterstone Financial or generate 5.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Waterstone Financial vs. OneMain Holdings
Performance |
| Timeline |
| Waterstone Financial |
| OneMain Holdings |
Waterstone Financial and OneMain Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Waterstone Financial and OneMain Holdings
The main advantage of trading using opposite Waterstone Financial and OneMain Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Waterstone Financial position performs unexpectedly, OneMain Holdings 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 OneMain Holdings will offset losses from the drop in OneMain Holdings' long position.| Waterstone Financial vs. National Bank Holdings | Waterstone Financial vs. Community West Bancshares | Waterstone Financial vs. Financial Institutions | Waterstone Financial vs. Kearny Financial Corp |
| OneMain Holdings vs. Oaktree Specialty Lending | OneMain Holdings vs. Barings BDC | OneMain Holdings vs. Runway Growth Finance | OneMain Holdings vs. Ally Financial |
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..
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |