Correlation Between Wintrust Financial and First Citizens
Can any of the company-specific risk be diversified away by investing in both Wintrust Financial and First Citizens 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 First Citizens 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 First Citizens BancShares, you can compare the effects of market volatilities on Wintrust Financial and First Citizens 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 First Citizens. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wintrust Financial and First Citizens.
Diversification Opportunities for Wintrust Financial and First Citizens
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wintrust and First is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Wintrust Financial Corp and First Citizens BancShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Citizens BancShares 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 First Citizens. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Citizens BancShares has no effect on the direction of Wintrust Financial i.e., Wintrust Financial and First Citizens go up and down completely randomly.
Pair Corralation between Wintrust Financial and First Citizens
Assuming the 90 days horizon Wintrust Financial Corp is expected to generate 0.09 times more return on investment than First Citizens. However, Wintrust Financial Corp is 10.72 times less risky than First Citizens. It trades about 0.3 of its potential returns per unit of risk. First Citizens BancShares is currently generating about 0.01 per unit of risk. If you would invest 2,487 in Wintrust Financial Corp on October 26, 2024 and sell it today you would earn a total of 24.00 from holding Wintrust Financial Corp or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wintrust Financial Corp vs. First Citizens BancShares
Performance |
| Timeline |
| Wintrust Financial Corp |
| First Citizens BancShares |
Wintrust Financial and First Citizens Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wintrust Financial and First Citizens
The main advantage of trading using opposite Wintrust Financial and First Citizens positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wintrust Financial position performs unexpectedly, First Citizens 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 Citizens will offset losses from the drop in First Citizens' long position.| Wintrust Financial vs. Wintrust Financial Corp | Wintrust Financial vs. WesBanco | Wintrust Financial vs. Heartland Financial USA | Wintrust Financial vs. Pinnacle Financial Partners |
| First Citizens vs. Fifth Third Bancorp | First Citizens vs. Dime Community Bancshares | First Citizens vs. Fifth Third Bancorp | First Citizens vs. Northern Trust |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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