Correlation Between Synovus Financial and Cadence Bancorp
Can any of the company-specific risk be diversified away by investing in both Synovus Financial and Cadence 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 Synovus Financial and Cadence Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synovus Financial Corp and Cadence Bancorp, you can compare the effects of market volatilities on Synovus Financial and Cadence 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 Synovus Financial with a short position of Cadence Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synovus Financial and Cadence Bancorp.
Diversification Opportunities for Synovus Financial and Cadence Bancorp
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Synovus and Cadence is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Synovus Financial Corp and Cadence Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cadence Bancorp and Synovus 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 Synovus Financial Corp are associated (or correlated) with Cadence Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cadence Bancorp has no effect on the direction of Synovus Financial i.e., Synovus Financial and Cadence Bancorp go up and down completely randomly.
Pair Corralation between Synovus Financial and Cadence Bancorp
Considering the 90-day investment horizon Synovus Financial Corp is expected to under-perform the Cadence Bancorp. In addition to that, Synovus Financial is 1.16 times more volatile than Cadence Bancorp. It trades about -0.36 of its total potential returns per unit of risk. Cadence Bancorp is currently generating about -0.41 per unit of volatility. If you would invest 3,862 in Cadence Bancorp on September 23, 2024 and sell it today you would lose (454.00) from holding Cadence Bancorp or give up 11.76% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Synovus Financial Corp vs. Cadence Bancorp
Performance |
Timeline |
Synovus Financial Corp |
Cadence Bancorp |
Synovus Financial and Cadence Bancorp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Synovus Financial and Cadence Bancorp
The main advantage of trading using opposite Synovus Financial and Cadence Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synovus Financial position performs unexpectedly, Cadence 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 Cadence Bancorp will offset losses from the drop in Cadence Bancorp's long position.Synovus Financial vs. Huntington Bancshares Incorporated | Synovus Financial vs. Fifth Third Bancorp | Synovus Financial vs. MT Bank | Synovus Financial vs. Citizens Financial Group, |
Cadence Bancorp vs. Home Federal Bancorp | Cadence Bancorp vs. First Northwest Bancorp | Cadence Bancorp vs. Community West Bancshares | Cadence Bancorp vs. HomeTrust Bancshares |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Equity Valuation Check real value of public entities based on technical and fundamental data |