Correlation Between Glen Burnie and Citizens Bancorp

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

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

Diversification Opportunities for Glen Burnie and Citizens Bancorp

0.35

Correlation Coefficient

Glen Burnie  Citizens Bancorp

Weak diversification

The 3 months correlation between Glen and Citizens is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Glen Burnie Bancorp and Citizens Bancorp Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Bancorp Inv and Glen Burnie 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 Glen Burnie Bancorp are associated (or correlated) with Citizens Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Bancorp Inv has no effect on the direction of Glen Burnie i.e., Glen Burnie and Citizens Bancorp go up and down completely randomly.

Pair Corralation between Glen Burnie and Citizens Bancorp

Given the investment horizon of 90 days Glen Burnie Bancorp is expected to generate 6.74 times more return on investment than Citizens Bancorp. However, Glen Burnie is 6.74 times more volatile than Citizens Bancorp Investment. It trades about 0.04 of its potential returns per unit of risk. Citizens Bancorp Investment is currently generating about 0.23 per unit of risk. If you would invest  578.00  in Glen Burnie Bancorp on September 22, 2024 and sell it today you would earn a total of  7.00  from holding Glen Burnie Bancorp or generate 1.21% return on investment over 90 days.

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

Glen Burnie Bancorp  vs.  Citizens Bancorp Investment

Glen Burnie Bancorp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Glen Burnie Bancorp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain fundamental drivers, Glen Burnie may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Citizens Bancorp Inv

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Citizens Bancorp Investment are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Citizens Bancorp is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Glen Burnie and Citizens Bancorp

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

The idea behind Glen Burnie Bancorp and Citizens Bancorp Investment 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.