Correlation Between Citizens Financial and High Country

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

By analyzing existing cross correlation between Citizens Financial Services and High Country Bancorp, you can compare the effects of market volatilities on Citizens Financial and High Country 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 High Country. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and High Country.

Diversification Opportunities for Citizens Financial and High Country

0.0

Correlation Coefficient

Citizens Financial  High Country

Pay attention - limited upside

The 3 months correlation between Citizens and High is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Services and High Country Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Country Bancorp 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 Services are associated (or correlated) with High Country. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Country Bancorp has no effect on the direction of Citizens Financial i.e., Citizens Financial and High Country go up and down completely randomly.

Pair Corralation between Citizens Financial and High Country

If you would invest (100.00) in High Country Bancorp on December 28, 2024 and sell it today you would earn a total of  100.00  from holding High Country Bancorp or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Citizens Financial Services  vs.  High Country Bancorp

Citizens Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Citizens Financial Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Citizens Financial is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

High Country Bancorp

Risk-Adjusted Performance

Very Weak

Over the last 90 days High Country Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental drivers, High Country is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Citizens Financial and High Country

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

The idea behind Citizens Financial Services and High Country 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.

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.