Correlation Between Superior Plus and PNC Financial

Can any of the company-specific risk be diversified away by investing in both Superior Plus and PNC Financial 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 Superior Plus and PNC Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Superior Plus Corp and The PNC Financial, you can compare the effects of market volatilities on Superior Plus and PNC Financial 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 Superior Plus with a short position of PNC Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and PNC Financial.

Diversification Opportunities for Superior Plus and PNC Financial

0.0

Correlation Coefficient

Superior Plus  PNC Financial

Pay attention - limited upside

The 3 months correlation between Superior and PNC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and The PNC Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PNC Financial and Superior Plus 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 Superior Plus Corp are associated (or correlated) with PNC Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PNC Financial has no effect on the direction of Superior Plus i.e., Superior Plus and PNC Financial go up and down completely randomly.

Pair Corralation between Superior Plus and PNC Financial

If you would invest  0.00  in The PNC Financial on September 20, 2024 and sell it today you would earn a total of  0.00  from holding The PNC Financial or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Superior Plus Corp  vs.  The PNC Financial

Superior Plus Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Superior Plus Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

PNC Financial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The PNC Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, PNC Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Superior Plus and PNC Financial

The main advantage of trading using opposite Superior Plus and PNC Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, PNC Financial 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 PNC Financial will offset losses from the drop in PNC Financial's long position.

The idea behind Superior Plus Corp and The PNC Financial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.