Correlation Between Synchrony Financial and MT Bank
Can any of the company-specific risk be diversified away by investing in both Synchrony Financial and MT Bank 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 Synchrony Financial and MT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synchrony Financial and MT Bank, you can compare the effects of market volatilities on Synchrony Financial and MT Bank 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 Synchrony Financial with a short position of MT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synchrony Financial and MT Bank.
Diversification Opportunities for Synchrony Financial and MT Bank
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Synchrony and MTB is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Synchrony Financial and MT Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MT Bank and Synchrony 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 Synchrony Financial are associated (or correlated) with MT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MT Bank has no effect on the direction of Synchrony Financial i.e., Synchrony Financial and MT Bank go up and down completely randomly.
Pair Corralation between Synchrony Financial and MT Bank
Assuming the 90 days trading horizon Synchrony Financial is expected to generate 0.54 times more return on investment than MT Bank. However, Synchrony Financial is 1.86 times less risky than MT Bank. It trades about 0.13 of its potential returns per unit of risk. MT Bank is currently generating about -0.09 per unit of risk. If you would invest 1,903 in Synchrony Financial on July 18, 2025 and sell it today you would earn a total of 114.00 from holding Synchrony Financial or generate 5.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Synchrony Financial vs. MT Bank
Performance |
| Timeline |
| Synchrony Financial |
| MT Bank |
Synchrony Financial and MT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synchrony Financial and MT Bank
The main advantage of trading using opposite Synchrony Financial and MT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synchrony Financial position performs unexpectedly, MT Bank 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 MT Bank will offset losses from the drop in MT Bank's long position.| Synchrony Financial vs. Capital One Financial | Synchrony Financial vs. Capital One Financial | Synchrony Financial vs. Citizens Financial Group | Synchrony Financial vs. Wells Fargo |
| MT Bank vs. PNC Financial Services | MT Bank vs. Citizens Financial Group, | MT Bank vs. Regions Financial | MT Bank vs. Fifth Third 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |