Correlation Between Hancock Whitney and Fulton Financial

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

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

Diversification Opportunities for Hancock Whitney and Fulton Financial

0.98

Correlation Coefficient

Hancock Whitney  Fulton Financial

Almost no diversification

The 3 months correlation between Hancock and Fulton is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Hancock Whitney Corp and Fulton Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fulton Financial and Hancock Whitney 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 Hancock Whitney Corp are associated (or correlated) with Fulton Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fulton Financial has no effect on the direction of Hancock Whitney i.e., Hancock Whitney and Fulton Financial go up and down completely randomly.

Pair Corralation between Hancock Whitney and Fulton Financial

Considering the 90-day investment horizon Hancock Whitney is expected to generate 1.1 times less return on investment than Fulton Financial. In addition to that, Hancock Whitney is 1.06 times more volatile than Fulton Financial. It trades about 0.03 of its total potential returns per unit of risk. Fulton Financial is currently generating about 0.04 per unit of volatility. If you would invest  1,567  in Fulton Financial on September 14, 2024 and sell it today you would earn a total of  518.00  from holding Fulton Financial or generate 33.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	99.8%
Values	Daily Returns

Hancock Whitney Corp  vs.  Fulton Financial

Hancock Whitney Corp

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hancock Whitney Corp are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Hancock Whitney exhibited solid returns over the last few months and may actually be approaching a breakup point.

Fulton Financial

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fulton Financial are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile essential indicators, Fulton Financial unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hancock Whitney and Fulton Financial

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

The idea behind Hancock Whitney Corp and Fulton 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.