Correlation Between ServisFirst Bancshares and Federated Investors

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

By analyzing existing cross correlation between ServisFirst Bancshares and Federated Investors B, you can compare the effects of market volatilities on ServisFirst Bancshares and Federated Investors 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 ServisFirst Bancshares with a short position of Federated Investors. Check out your portfolio center. Please also check ongoing floating volatility patterns of ServisFirst Bancshares and Federated Investors.

Diversification Opportunities for ServisFirst Bancshares and Federated Investors

0.88

Correlation Coefficient

ServisFirst Bancshares  Federated Investors

Very poor diversification

The 3 months correlation between ServisFirst and Federated is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding ServisFirst Bancshares and Federated Investors B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Investors and ServisFirst Bancshares 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 ServisFirst Bancshares are associated (or correlated) with Federated Investors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Investors has no effect on the direction of ServisFirst Bancshares i.e., ServisFirst Bancshares and Federated Investors go up and down completely randomly.

Pair Corralation between ServisFirst Bancshares and Federated Investors

Given the investment horizon of 90 days ServisFirst Bancshares is expected to under-perform the Federated Investors. In addition to that, ServisFirst Bancshares is 1.47 times more volatile than Federated Investors B. It trades about -0.11 of its total potential returns per unit of risk. Federated Investors B is currently generating about -0.02 per unit of volatility. If you would invest  5,219  in Federated Investors B on September 9, 2025 and sell it today you would lose (134.00) from holding Federated Investors B or give up 2.57% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.46%
Values	Daily Returns

ServisFirst Bancshares  vs.  Federated Investors B

ServisFirst Bancshares

Risk-Adjusted Performance

Weakest

Over the last 90 days ServisFirst Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's fundamental drivers remain comparatively stable which may send shares a bit higher in January 2026. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Federated Investors

Risk-Adjusted Performance

Weakest

Over the last 90 days Federated Investors B has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Federated Investors is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with ServisFirst Bancshares and Federated Investors

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

The idea behind ServisFirst Bancshares and Federated Investors B 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.