Correlation Between HomeTrust Bancshares, and Transcontinental

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

By analyzing existing cross correlation between HomeTrust Bancshares, and Transcontinental Realty Investors, you can compare the effects of market volatilities on HomeTrust Bancshares, and Transcontinental 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 HomeTrust Bancshares, with a short position of Transcontinental. Check out your portfolio center. Please also check ongoing floating volatility patterns of HomeTrust Bancshares, and Transcontinental.

Diversification Opportunities for HomeTrust Bancshares, and Transcontinental

0.63

Correlation Coefficient

HomeTrust Bancshares,  Transcontinental

Poor diversification

The 3 months correlation between HomeTrust and Transcontinental is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding HomeTrust Bancshares, and Transcontinental Realty Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transcontinental Realty and HomeTrust Bancshares, 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 HomeTrust Bancshares, are associated (or correlated) with Transcontinental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transcontinental Realty has no effect on the direction of HomeTrust Bancshares, i.e., HomeTrust Bancshares, and Transcontinental go up and down completely randomly.

Pair Corralation between HomeTrust Bancshares, and Transcontinental

Considering the 90-day investment horizon HomeTrust Bancshares, is expected to generate 6.65 times less return on investment than Transcontinental. But when comparing it to its historical volatility, HomeTrust Bancshares, is 2.27 times less risky than Transcontinental. It trades about 0.04 of its potential returns per unit of risk. Transcontinental Realty Investors is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  3,484  in Transcontinental Realty Investors on May 13, 2025 and sell it today you would earn a total of  680.00  from holding Transcontinental Realty Investors or generate 19.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

HomeTrust Bancshares,  vs.  Transcontinental Realty Invest

HomeTrust Bancshares,

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in HomeTrust Bancshares, are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, HomeTrust Bancshares, is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Transcontinental Realty

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Transcontinental Realty Investors are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent fundamental indicators, Transcontinental demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HomeTrust Bancshares, and Transcontinental

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

The idea behind HomeTrust Bancshares, and Transcontinental Realty Investors 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.