Correlation Between 1st Capital and First BanCorp
Can any of the company-specific risk be diversified away by investing in both 1st Capital and First BanCorp 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 First BanCorp 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 First BanCorp PFD, you can compare the effects of market volatilities on 1st Capital and First BanCorp 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 First BanCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1st Capital and First BanCorp.
Diversification Opportunities for 1st Capital and First BanCorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 1st and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding 1st Capital Bank and First BanCorp PFD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First BanCorp PFD 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 First BanCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First BanCorp PFD has no effect on the direction of 1st Capital i.e., 1st Capital and First BanCorp go up and down completely randomly.
Pair Corralation between 1st Capital and First BanCorp
If you would invest (100.00) in First BanCorp PFD on January 20, 2024 and sell it today you would earn a total of 100.00 from holding First BanCorp PFD or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
1st Capital Bank vs. First BanCorp PFD
Performance |
| Timeline |
| 1st Capital Bank |
| First BanCorp PFD |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
1st Capital and First BanCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1st Capital and First BanCorp
The main advantage of trading using opposite 1st Capital and First BanCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1st Capital position performs unexpectedly, First BanCorp 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 BanCorp will offset losses from the drop in First BanCorp's long position.| 1st Capital vs. Pacific Valley Bank | 1st Capital vs. First Northern Community | 1st Capital vs. 1st Colonial Bancorp |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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