Correlation Between Citizens Bancorp and CCCB Bancorp

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

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

Diversification Opportunities for Citizens Bancorp and CCCB Bancorp

-0.6

Correlation Coefficient

Citizens Bancorp  CCCB Bancorp

Excellent diversification

The 3 months correlation between Citizens and CCCB is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Bancorp Investment and CCCB Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCCB Bancorp and Citizens Bancorp 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 Bancorp Investment are associated (or correlated) with CCCB Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCCB Bancorp has no effect on the direction of Citizens Bancorp i.e., Citizens Bancorp and CCCB Bancorp go up and down completely randomly.

Pair Corralation between Citizens Bancorp and CCCB Bancorp

Given the investment horizon of 90 days Citizens Bancorp Investment is expected to generate 1.24 times more return on investment than CCCB Bancorp. However, Citizens Bancorp is 1.24 times more volatile than CCCB Bancorp. It trades about 0.06 of its potential returns per unit of risk. CCCB Bancorp is currently generating about -0.04 per unit of risk. If you would invest  2,684  in Citizens Bancorp Investment on December 28, 2024 and sell it today you would earn a total of  165.00  from holding Citizens Bancorp Investment or generate 6.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Citizens Bancorp Investment  vs.  CCCB Bancorp

Citizens Bancorp Inv

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Citizens Bancorp Investment are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Citizens Bancorp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

CCCB Bancorp

Risk-Adjusted Performance

Very Weak

Over the last 90 days CCCB Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, CCCB Bancorp is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Citizens Bancorp and CCCB Bancorp

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

The idea behind Citizens Bancorp Investment and CCCB Bancorp 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.