Correlation Between Wintrust Financial and CHS
Can any of the company-specific risk be diversified away by investing in both Wintrust Financial and CHS 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 Wintrust Financial and CHS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wintrust Financial Corp and CHS Inc CN, you can compare the effects of market volatilities on Wintrust Financial and CHS 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 Wintrust Financial with a short position of CHS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wintrust Financial and CHS.
Diversification Opportunities for Wintrust Financial and CHS
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Wintrust and CHS is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Wintrust Financial Corp and CHS Inc CN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHS Inc CN and Wintrust 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 Wintrust Financial Corp are associated (or correlated) with CHS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHS Inc CN has no effect on the direction of Wintrust Financial i.e., Wintrust Financial and CHS go up and down completely randomly.
Pair Corralation between Wintrust Financial and CHS
Assuming the 90 days horizon Wintrust Financial Corp is expected to generate 2.52 times more return on investment than CHS. However, Wintrust Financial is 2.52 times more volatile than CHS Inc CN. It trades about 0.03 of its potential returns per unit of risk. CHS Inc CN is currently generating about 0.05 per unit of risk. If you would invest 2,223 in Wintrust Financial Corp on August 31, 2024 and sell it today you would earn a total of 297.00 from holding Wintrust Financial Corp or generate 13.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wintrust Financial Corp vs. CHS Inc CN
Performance |
| Timeline |
| Wintrust Financial Corp |
| CHS Inc CN |
Wintrust Financial and CHS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wintrust Financial and CHS
The main advantage of trading using opposite Wintrust Financial and CHS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wintrust Financial position performs unexpectedly, CHS 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 CHS will offset losses from the drop in CHS's long position.| Wintrust Financial vs. KeyCorp | Wintrust Financial vs. KeyCorp | Wintrust Financial vs. Fifth Third Bancorp | Wintrust Financial vs. Citizens Financial 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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