Correlation Between Baraboo Bancorporation and Citizens Financial
Can any of the company-specific risk be diversified away by investing in both Baraboo Bancorporation and Citizens Financial 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 Baraboo Bancorporation and Citizens Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baraboo Bancorporation and Citizens Financial Corp, you can compare the effects of market volatilities on Baraboo Bancorporation and Citizens Financial 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 Baraboo Bancorporation with a short position of Citizens Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baraboo Bancorporation and Citizens Financial.
Diversification Opportunities for Baraboo Bancorporation and Citizens Financial
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Baraboo and Citizens is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Baraboo Bancorp. and Citizens Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Financial Corp and Baraboo Bancorporation 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 Baraboo Bancorporation are associated (or correlated) with Citizens Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Financial Corp has no effect on the direction of Baraboo Bancorporation i.e., Baraboo Bancorporation and Citizens Financial go up and down completely randomly.
Pair Corralation between Baraboo Bancorporation and Citizens Financial
Given the investment horizon of 90 days Baraboo Bancorporation is expected to generate 1.64 times less return on investment than Citizens Financial. But when comparing it to its historical volatility, Baraboo Bancorporation is 1.19 times less risky than Citizens Financial. It trades about 0.22 of its potential returns per unit of risk. Citizens Financial Corp is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 2,345 in Citizens Financial Corp on September 1, 2024 and sell it today you would earn a total of 255.00 from holding Citizens Financial Corp or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baraboo Bancorp. vs. Citizens Financial Corp
Performance |
| Timeline |
| Baraboo Bancorporation |
| Citizens Financial Corp |
Baraboo Bancorporation and Citizens Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baraboo Bancorporation and Citizens Financial
The main advantage of trading using opposite Baraboo Bancorporation and Citizens Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baraboo Bancorporation position performs unexpectedly, Citizens Financial 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 Financial will offset losses from the drop in Citizens Financial's long position.| Baraboo Bancorporation vs. Piraeus Bank SA | Baraboo Bancorporation vs. Turkiye Garanti Bankasi | Baraboo Bancorporation vs. Delhi Bank Corp | Baraboo Bancorporation vs. Uwharrie Capital Corp |
| Citizens Financial vs. Century Next Financial | Citizens Financial vs. Triad Business Bank | Citizens Financial vs. First Ottawa Bancshares | Citizens Financial vs. First Community Financial |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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