Correlation Between Regions Financial and NYCB Old

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

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

Diversification Opportunities for Regions Financial and NYCB Old

0.0

Correlation Coefficient

Regions Financial  NYCB Old

Pay attention - limited upside

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

Pair Corralation between Regions Financial and NYCB Old

If you would invest (100.00) in NYCB Old on December 27, 2024 and sell it today you would earn a total of  100.00  from holding NYCB Old 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

Regions Financial  vs.  NYCB Old

Regions Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Regions Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

NYCB Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days NYCB Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, NYCB Old is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Regions Financial and NYCB Old

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

The idea behind Regions Financial and NYCB Old 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.