Correlation Between Princeton Capital and First Guaranty
Can any of the company-specific risk be diversified away by investing in both Princeton Capital and First Guaranty 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 Princeton Capital and First Guaranty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Princeton Capital and First Guaranty Bancshares, you can compare the effects of market volatilities on Princeton Capital and First Guaranty 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 Princeton Capital with a short position of First Guaranty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Princeton Capital and First Guaranty.
Diversification Opportunities for Princeton Capital and First Guaranty
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Princeton and First is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Princeton Capital and First Guaranty Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Guaranty Bancshares and Princeton Capital 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 Princeton Capital are associated (or correlated) with First Guaranty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Guaranty Bancshares has no effect on the direction of Princeton Capital i.e., Princeton Capital and First Guaranty go up and down completely randomly.
Pair Corralation between Princeton Capital and First Guaranty
Given the investment horizon of 90 days Princeton Capital is expected to under-perform the First Guaranty. In addition to that, Princeton Capital is 1.96 times more volatile than First Guaranty Bancshares. It trades about -0.16 of its total potential returns per unit of risk. First Guaranty Bancshares is currently generating about -0.08 per unit of volatility. If you would invest 904.00 in First Guaranty Bancshares on May 28, 2025 and sell it today you would lose (124.00) from holding First Guaranty Bancshares or give up 13.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Princeton Capital vs. First Guaranty Bancshares
Performance |
| Timeline |
| Princeton Capital |
| First Guaranty Bancshares |
Princeton Capital and First Guaranty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Princeton Capital and First Guaranty
The main advantage of trading using opposite Princeton Capital and First Guaranty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Princeton Capital position performs unexpectedly, First Guaranty 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 First Guaranty will offset losses from the drop in First Guaranty's long position.| Princeton Capital vs. Flow Capital Corp | Princeton Capital vs. Blackhawk Growth Corp | Princeton Capital vs. Urbana | Princeton Capital vs. Guardian Capital Group |
| First Guaranty vs. Home Bancorp | First Guaranty vs. Community West Bancshares | First Guaranty vs. First Community | First Guaranty vs. First Northwest Bancorp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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