Correlation Between Mercantil Bank and Banc Of

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Mercantil Bank and Banc Of 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 Mercantil Bank and Banc Of into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mercantil Bank Holding and Banc Of California, you can compare the effects of market volatilities on Mercantil Bank and Banc Of 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 Mercantil Bank with a short position of Banc Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mercantil Bank and Banc Of.

Diversification Opportunities for Mercantil Bank and Banc Of

0.84
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Mercantil and Banc Of is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Mercantil Bank Holding and Banc Of California Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banc Of California and Mercantil Bank 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 Mercantil Bank Holding are associated (or correlated) with Banc Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banc Of California has no effect on the direction of Mercantil Bank i.e., Mercantil Bank and Banc Of go up and down completely randomly.

Pair Corralation between Mercantil Bank and Banc Of

Given the investment horizon of 90 days Mercantil Bank Holding is expected to generate 1.02 times more return on investment than Banc Of. However, Mercantil Bank is 1.02 times more volatile than Banc Of California. It trades about -0.12 of its potential returns per unit of risk. Banc Of California is currently generating about -0.16 per unit of risk. If you would invest  2,619  in Mercantil Bank Holding on July 2, 2022 and sell it today you would lose (96.00)  from holding Mercantil Bank Holding or give up 3.67% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Mercantil Bank Holding  vs.  Banc Of California Inc

 Performance (%) 
       Timeline  
Mercantil Bank Holding 
Mercantil Performance
0 of 100
Over the last 90 days Mercantil Bank Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Mercantil Price Channel

Banc Of California 
Banc Of Performance
0 of 100
Over the last 90 days Banc Of California has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Banc Of Price Channel

Mercantil Bank and Banc Of Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Mercantil Bank and Banc Of

The main advantage of trading using opposite Mercantil Bank and Banc Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mercantil Bank position performs unexpectedly, Banc Of 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 Banc Of will offset losses from the drop in Banc Of's long position.
Mercantil Bank vs. Amazon Inc
The idea behind Mercantil Bank Holding and Banc Of California 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.
Banc Of vs. Amazon Inc
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 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.

Other Complementary Tools

Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Go
Commodity Channel Index
Use Commodity Channel Index to analyze current equity momentum
Go
Price Transformation
Use Price Transformation models to analyze depth of different equity instruments across global markets
Go
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Go
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
Go
Fund Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Go
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Go
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Go
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Go
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Go
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Go