Correlation Between WSFS Financial and International Bancshares
Can any of the company-specific risk be diversified away by investing in both WSFS Financial and International Bancshares 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 WSFS Financial and International Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WSFS Financial and International Bancshares, you can compare the effects of market volatilities on WSFS Financial and International Bancshares 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 WSFS Financial with a short position of International Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of WSFS Financial and International Bancshares.
Diversification Opportunities for WSFS Financial and International Bancshares
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between WSFS and International is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding WSFS Financial and International Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Bancshares and WSFS 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 WSFS Financial are associated (or correlated) with International Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Bancshares has no effect on the direction of WSFS Financial i.e., WSFS Financial and International Bancshares go up and down completely randomly.
Pair Corralation between WSFS Financial and International Bancshares
Given the investment horizon of 90 days WSFS Financial is expected to generate 0.94 times more return on investment than International Bancshares. However, WSFS Financial is 1.06 times less risky than International Bancshares. It trades about 0.09 of its potential returns per unit of risk. International Bancshares is currently generating about -0.12 per unit of risk. If you would invest 5,745 in WSFS Financial on September 12, 2024 and sell it today you would earn a total of 137.00 from holding WSFS Financial or generate 2.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
WSFS Financial vs. International Bancshares
Performance |
| Timeline |
| WSFS Financial |
| International Bancshares |
WSFS Financial and International Bancshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WSFS Financial and International Bancshares
The main advantage of trading using opposite WSFS Financial and International Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WSFS Financial position performs unexpectedly, International Bancshares 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 International Bancshares will offset losses from the drop in International Bancshares' long position.| WSFS Financial vs. Western New England | WSFS Financial vs. Great Southern Bancorp | WSFS Financial vs. First Financial | WSFS Financial vs. Heritage Financial |
| International Bancshares vs. JPMorgan Chase Co | International Bancshares vs. Citigroup | International Bancshares vs. Wells Fargo | International Bancshares vs. Toronto Dominion Bank |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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