Correlation Between WesBanco and Kearny Financial
Can any of the company-specific risk be diversified away by investing in both WesBanco and Kearny Financial 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 WesBanco and Kearny Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WesBanco and Kearny Financial Corp, you can compare the effects of market volatilities on WesBanco and Kearny Financial 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 WesBanco with a short position of Kearny Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of WesBanco and Kearny Financial.
Diversification Opportunities for WesBanco and Kearny Financial
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WesBanco and Kearny is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding WesBanco and Kearny Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kearny Financial Corp and WesBanco 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 WesBanco are associated (or correlated) with Kearny Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kearny Financial Corp has no effect on the direction of WesBanco i.e., WesBanco and Kearny Financial go up and down completely randomly.
Pair Corralation between WesBanco and Kearny Financial
Assuming the 90 days horizon WesBanco is expected to generate 0.13 times more return on investment than Kearny Financial. However, WesBanco is 7.71 times less risky than Kearny Financial. It trades about 0.1 of its potential returns per unit of risk. Kearny Financial Corp is currently generating about -0.1 per unit of risk. If you would invest 2,478 in WesBanco on December 1, 2024 and sell it today you would earn a total of 39.00 from holding WesBanco or generate 1.57% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
WesBanco vs. Kearny Financial Corp
Performance |
Timeline |
WesBanco |
Kearny Financial Corp |
WesBanco and Kearny Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WesBanco and Kearny Financial
The main advantage of trading using opposite WesBanco and Kearny Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WesBanco position performs unexpectedly, Kearny Financial 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 Kearny Financial will offset losses from the drop in Kearny Financial's long position.The idea behind WesBanco and Kearny Financial Corp 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.Kearny Financial vs. National Bank Holdings | Kearny Financial vs. Community West Bancshares | Kearny Financial vs. Financial Institutions | Kearny Financial vs. Heritage Financial |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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