Correlation Between Citizens Financial and Brpr Corporate

Can any of the company-specific risk be diversified away by investing in both Citizens Financial and Brpr Corporate 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 Citizens Financial and Brpr Corporate into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Citizens Financial Group, and Brpr Corporate Offices, you can compare the effects of market volatilities on Citizens Financial and Brpr Corporate 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 Citizens Financial with a short position of Brpr Corporate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Brpr Corporate.

Diversification Opportunities for Citizens Financial and Brpr Corporate

-0.24

Correlation Coefficient

Citizens Financial  Brpr Corporate

Very good diversification

The 3 months correlation between Citizens and Brpr is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group, and Brpr Corporate Offices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brpr Corporate Offices and Citizens 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 Citizens Financial Group, are associated (or correlated) with Brpr Corporate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brpr Corporate Offices has no effect on the direction of Citizens Financial i.e., Citizens Financial and Brpr Corporate go up and down completely randomly.

Pair Corralation between Citizens Financial and Brpr Corporate

Assuming the 90 days trading horizon Citizens Financial Group, is expected to generate 1.88 times more return on investment than Brpr Corporate. However, Citizens Financial is 1.88 times more volatile than Brpr Corporate Offices. It trades about 0.13 of its potential returns per unit of risk. Brpr Corporate Offices is currently generating about 0.0 per unit of risk. If you would invest  22,663  in Citizens Financial Group, on October 8, 2024 and sell it today you would earn a total of  4,308  from holding Citizens Financial Group, or generate 19.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Citizens Financial Group,  vs.  Brpr Corporate Offices

Citizens Financial Group,

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citizens Financial Group, are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Citizens Financial sustained solid returns over the last few months and may actually be approaching a breakup point.

Brpr Corporate Offices

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brpr Corporate Offices has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Brpr Corporate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Citizens Financial and Brpr Corporate

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

The idea behind Citizens Financial Group, and Brpr Corporate Offices 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.