Correlation Between 1st Capital and Popular

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Can any of the company-specific risk be diversified away by investing in both 1st Capital and Popular 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 1st Capital and Popular into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1st Capital Bank and Popular, you can compare the effects of market volatilities on 1st Capital and Popular 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 1st Capital with a short position of Popular. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1st Capital and Popular.

Diversification Opportunities for 1st Capital and Popular

0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between 1st Capital and Popular

If you would invest  0.00  in Popular on December 29, 2023 and sell it today you would earn a total of  0.00  from holding Popular or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy4.35%
ValuesDaily Returns

1st Capital Bank  vs.  Popular

 Performance 
       Timeline  
1st Capital Bank 

Risk-Adjusted Performance

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Over the last 90 days 1st Capital Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.
Popular 

Risk-Adjusted Performance

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High
Very Weak
Over the last 90 days Popular has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Popular is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

1st Capital and Popular Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with 1st Capital and Popular

The main advantage of trading using opposite 1st Capital and Popular positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1st Capital position performs unexpectedly, Popular 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 Popular will offset losses from the drop in Popular's long position.
The idea behind 1st Capital Bank and Popular 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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