Correlation Between HUNTINGTON and Univest Pennsylvania

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

By analyzing existing cross correlation between HUNTINGTON BANCSHARES INC and Univest Pennsylvania, you can compare the effects of market volatilities on HUNTINGTON and Univest Pennsylvania 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 HUNTINGTON with a short position of Univest Pennsylvania. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUNTINGTON and Univest Pennsylvania.

Diversification Opportunities for HUNTINGTON and Univest Pennsylvania

0.11

Correlation Coefficient

HUNTINGTON  Univest Pennsylvania

Average diversification

The 3 months correlation between HUNTINGTON and Univest is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding HUNTINGTON BANCSHARES INC and Univest Pennsylvania in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Univest Pennsylvania and HUNTINGTON 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 HUNTINGTON BANCSHARES INC are associated (or correlated) with Univest Pennsylvania. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Univest Pennsylvania has no effect on the direction of HUNTINGTON i.e., HUNTINGTON and Univest Pennsylvania go up and down completely randomly.

Pair Corralation between HUNTINGTON and Univest Pennsylvania

Assuming the 90 days trading horizon HUNTINGTON is expected to generate 31.3 times less return on investment than Univest Pennsylvania. But when comparing it to its historical volatility, HUNTINGTON BANCSHARES INC is 4.11 times less risky than Univest Pennsylvania. It trades about 0.0 of its potential returns per unit of risk. Univest Pennsylvania is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  2,428  in Univest Pennsylvania on October 4, 2024 and sell it today you would earn a total of  523.00  from holding Univest Pennsylvania or generate 21.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.97%
Values	Daily Returns

HUNTINGTON BANCSHARES INC  vs.  Univest Pennsylvania

HUNTINGTON BANCSHARES INC

Risk-Adjusted Performance

0 of 100

Very Weak

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

Univest Pennsylvania

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Univest Pennsylvania are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal basic indicators, Univest Pennsylvania may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with HUNTINGTON and Univest Pennsylvania

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

The idea behind HUNTINGTON BANCSHARES INC and Univest Pennsylvania 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 Stocks Directory module to find actively traded stocks across global markets.