Correlation Between Bank of America and Citizens Holding
Can any of the company-specific risk be diversified away by investing in both Bank of America and Citizens Holding 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 Bank of America and Citizens Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of America and Citizens Holding, you can compare the effects of market volatilities on Bank of America and Citizens Holding 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 Bank of America with a short position of Citizens Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Citizens Holding.
Diversification Opportunities for Bank of America and Citizens Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Citizens is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Citizens Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Holding and Bank of America 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 Bank of America are associated (or correlated) with Citizens Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Holding has no effect on the direction of Bank of America i.e., Bank of America and Citizens Holding go up and down completely randomly.
Pair Corralation between Bank of America and Citizens Holding
If you would invest (100.00) in Citizens Holding on January 11, 2025 and sell it today you would earn a total of 100.00 from holding Citizens Holding 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 |
Bank of America vs. Citizens Holding
Performance |
| Timeline |
| Bank of America |
| Citizens Holding |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Bank of America and Citizens Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Citizens Holding
The main advantage of trading using opposite Bank of America and Citizens Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Citizens Holding 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 Holding will offset losses from the drop in Citizens Holding's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of |
| Citizens Holding vs. Home Federal Bancorp | Citizens Holding vs. Lake Shore Bancorp | Citizens Holding vs. Community West Bancshares | Citizens Holding vs. Magyar Bancorp |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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