Correlation Between 1ST SUMMIT and Lloyds Banking
Can any of the company-specific risk be diversified away by investing in both 1ST SUMMIT and Lloyds Banking 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 SUMMIT and Lloyds Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1ST SUMMIT BANCORP and Lloyds Banking Group, you can compare the effects of market volatilities on 1ST SUMMIT and Lloyds Banking 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 SUMMIT with a short position of Lloyds Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1ST SUMMIT and Lloyds Banking.
Diversification Opportunities for 1ST SUMMIT and Lloyds Banking
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 1ST and Lloyds is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding 1ST SUMMIT BANCORP and Lloyds Banking Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lloyds Banking Group and 1ST SUMMIT 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 SUMMIT BANCORP are associated (or correlated) with Lloyds Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lloyds Banking Group has no effect on the direction of 1ST SUMMIT i.e., 1ST SUMMIT and Lloyds Banking go up and down completely randomly.
Pair Corralation between 1ST SUMMIT and Lloyds Banking
If you would invest 251.00 in Lloyds Banking Group on January 21, 2024 and sell it today you would earn a total of 1.00 from holding Lloyds Banking Group or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
1ST SUMMIT BANCORP vs. Lloyds Banking Group
Performance |
| Timeline |
| 1ST SUMMIT BANCORP |
| Lloyds Banking Group |
1ST SUMMIT and Lloyds Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1ST SUMMIT and Lloyds Banking
The main advantage of trading using opposite 1ST SUMMIT and Lloyds Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1ST SUMMIT position performs unexpectedly, Lloyds Banking 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 Lloyds Banking will offset losses from the drop in Lloyds Banking's long position.| 1ST SUMMIT vs. Apollo Bancorp | 1ST SUMMIT vs. Oregon Pacific Bancorp | 1ST SUMMIT vs. The Farmers Bank | 1ST SUMMIT vs. Community Bankers |
| Lloyds Banking vs. CrossFirst Bankshares | Lloyds Banking vs. Banco Bradesco SA | Lloyds Banking vs. CF Bankshares | Lloyds Banking vs. Foreign Trade Bank |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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