Correlation Between Citizens Bancorp and CreditRiskMonitorCom

Can any of the company-specific risk be diversified away by investing in both Citizens Bancorp and CreditRiskMonitorCom 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 CreditRiskMonitorCom 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 CreditRiskMonitorCom, you can compare the effects of market volatilities on Citizens Bancorp and CreditRiskMonitorCom 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 CreditRiskMonitorCom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Bancorp and CreditRiskMonitorCom.

Diversification Opportunities for Citizens Bancorp and CreditRiskMonitorCom

0.54

Correlation Coefficient

Citizens Bancorp  CreditRiskMonitorCom

Very weak diversification

The 3 months correlation between Citizens and CreditRiskMonitorCom is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Bancorp Investment and CreditRiskMonitorCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CreditRiskMonitorCom 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 CreditRiskMonitorCom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CreditRiskMonitorCom has no effect on the direction of Citizens Bancorp i.e., Citizens Bancorp and CreditRiskMonitorCom go up and down completely randomly.

Pair Corralation between Citizens Bancorp and CreditRiskMonitorCom

Given the investment horizon of 90 days Citizens Bancorp Investment is expected to generate 0.5 times more return on investment than CreditRiskMonitorCom. However, Citizens Bancorp Investment is 1.99 times less risky than CreditRiskMonitorCom. It trades about 0.14 of its potential returns per unit of risk. CreditRiskMonitorCom is currently generating about -0.15 per unit of risk. If you would invest  2,555  in Citizens Bancorp Investment on October 8, 2024 and sell it today you would earn a total of  95.00  from holding Citizens Bancorp Investment or generate 3.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.0%
Values	Daily Returns

Citizens Bancorp Investment  vs.  CreditRiskMonitorCom

Citizens Bancorp Inv

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citizens Bancorp Investment are ranked lower than 8 (%) 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 February 2025.

CreditRiskMonitorCom

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CreditRiskMonitorCom are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile primary indicators, CreditRiskMonitorCom showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Citizens Bancorp and CreditRiskMonitorCom

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

The idea behind Citizens Bancorp Investment and CreditRiskMonitorCom 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.