Correlation Between First National and Partners Value

Can any of the company-specific risk be diversified away by investing in both First National and Partners Value 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 First National and Partners Value into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between First National Financial and Partners Value Investments, you can compare the effects of market volatilities on First National and Partners Value 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 First National with a short position of Partners Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of First National and Partners Value.

Diversification Opportunities for First National and Partners Value

-0.59

Correlation Coefficient

First National  Partners Value

Excellent diversification

The 3 months correlation between First and Partners is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding First National Financial and Partners Value Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Partners Value Inves and First National 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 First National Financial are associated (or correlated) with Partners Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Partners Value Inves has no effect on the direction of First National i.e., First National and Partners Value go up and down completely randomly.

Pair Corralation between First National and Partners Value

Assuming the 90 days trading horizon First National Financial is expected to generate 0.18 times more return on investment than Partners Value. However, First National Financial is 5.69 times less risky than Partners Value. It trades about 0.2 of its potential returns per unit of risk. Partners Value Investments is currently generating about -0.12 per unit of risk. If you would invest  1,521  in First National Financial on May 22, 2025 and sell it today you would earn a total of  399.00  from holding First National Financial or generate 26.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

First National Financial  vs.  Partners Value Investments

First National Financial

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in First National Financial are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, First National unveiled solid returns over the last few months and may actually be approaching a breakup point.

Partners Value Inves

Risk-Adjusted Performance

Weakest

Over the last 90 days Partners Value Investments has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with First National and Partners Value

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

The idea behind First National Financial and Partners Value Investments 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.