Correlation Between FIRST NATIONAL and TIMBERCREEK FINL
Can any of the company-specific risk be diversified away by investing in both FIRST NATIONAL and TIMBERCREEK FINL 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 FIRST NATIONAL and TIMBERCREEK FINL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIRST NATIONAL FIN and TIMBERCREEK FINL, you can compare the effects of market volatilities on FIRST NATIONAL and TIMBERCREEK FINL 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 FIRST NATIONAL with a short position of TIMBERCREEK FINL. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST NATIONAL and TIMBERCREEK FINL.
Diversification Opportunities for FIRST NATIONAL and TIMBERCREEK FINL
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between FIRST and TIMBERCREEK is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding FIRST NATIONAL FIN and TIMBERCREEK FINL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TIMBERCREEK FINL and FIRST NATIONAL 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 FIRST NATIONAL FIN are associated (or correlated) with TIMBERCREEK FINL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TIMBERCREEK FINL has no effect on the direction of FIRST NATIONAL i.e., FIRST NATIONAL and TIMBERCREEK FINL go up and down completely randomly.
Pair Corralation between FIRST NATIONAL and TIMBERCREEK FINL
Assuming the 90 days horizon FIRST NATIONAL FIN is expected to under-perform the TIMBERCREEK FINL. But the stock apears to be less risky and, when comparing its historical volatility, FIRST NATIONAL FIN is 1.09 times less risky than TIMBERCREEK FINL. The stock trades about -0.25 of its potential returns per unit of risk. The TIMBERCREEK FINL is currently generating about -0.19 of returns per unit of risk over similar time horizon. If you would invest 514.00 in TIMBERCREEK FINL on September 25, 2024 and sell it today you would lose (44.00) from holding TIMBERCREEK FINL or give up 8.56% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
FIRST NATIONAL FIN vs. TIMBERCREEK FINL
Performance |
Timeline |
FIRST NATIONAL FIN |
TIMBERCREEK FINL |
FIRST NATIONAL and TIMBERCREEK FINL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FIRST NATIONAL and TIMBERCREEK FINL
The main advantage of trading using opposite FIRST NATIONAL and TIMBERCREEK FINL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST NATIONAL position performs unexpectedly, TIMBERCREEK FINL 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 TIMBERCREEK FINL will offset losses from the drop in TIMBERCREEK FINL's long position.FIRST NATIONAL vs. X FAB Silicon Foundries | FIRST NATIONAL vs. Mobilezone Holding AG | FIRST NATIONAL vs. MACOM Technology Solutions | FIRST NATIONAL vs. Sunny Optical Technology |
TIMBERCREEK FINL vs. Mr Cooper Group | TIMBERCREEK FINL vs. OSB GROUP PLC | TIMBERCREEK FINL vs. FIRST NATIONAL FIN | TIMBERCREEK FINL vs. Deutsche Pfandbriefbank AG |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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