Correlation Between CCSB Financial and Comerica

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

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

Diversification Opportunities for CCSB Financial and Comerica

-0.52

Correlation Coefficient

CCSB Financial  Comerica

Excellent diversification

The 3 months correlation between CCSB and Comerica is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding CCSB Financial Corp and Comerica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comerica and CCSB 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 CCSB Financial Corp are associated (or correlated) with Comerica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comerica has no effect on the direction of CCSB Financial i.e., CCSB Financial and Comerica go up and down completely randomly.

Pair Corralation between CCSB Financial and Comerica

Given the investment horizon of 90 days CCSB Financial Corp is expected to generate 1.12 times more return on investment than Comerica. However, CCSB Financial is 1.12 times more volatile than Comerica. It trades about 0.13 of its potential returns per unit of risk. Comerica is currently generating about -0.01 per unit of risk. If you would invest  1,050  in CCSB Financial Corp on December 19, 2024 and sell it today you would earn a total of  165.00  from holding CCSB Financial Corp or generate 15.71% return on investment over 90 days.

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

CCSB Financial Corp  vs.  Comerica

CCSB Financial Corp

Risk-Adjusted Performance

OK

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

Comerica

Risk-Adjusted Performance

Very Weak

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

Pair Trading with CCSB Financial and Comerica

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

The idea behind CCSB Financial Corp and Comerica 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 CEOs Directory module to screen CEOs from public companies around the world.