Correlation Between Sierra Bancorp and Citizens Community
Can any of the company-specific risk be diversified away by investing in both Sierra Bancorp and Citizens Community 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 Sierra Bancorp and Citizens Community into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sierra Bancorp and Citizens Community Bancorp, you can compare the effects of market volatilities on Sierra Bancorp and Citizens Community 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 Sierra Bancorp with a short position of Citizens Community. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sierra Bancorp and Citizens Community.
Diversification Opportunities for Sierra Bancorp and Citizens Community
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sierra and Citizens is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sierra Bancorp and Citizens Community Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Community and Sierra Bancorp 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 Sierra Bancorp are associated (or correlated) with Citizens Community. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Community has no effect on the direction of Sierra Bancorp i.e., Sierra Bancorp and Citizens Community go up and down completely randomly.
Pair Corralation between Sierra Bancorp and Citizens Community
Given the investment horizon of 90 days Sierra Bancorp is expected to generate 1.12 times less return on investment than Citizens Community. In addition to that, Sierra Bancorp is 3.11 times more volatile than Citizens Community Bancorp. It trades about 0.13 of its total potential returns per unit of risk. Citizens Community Bancorp is currently generating about 0.44 per unit of volatility. If you would invest 1,418 in Citizens Community Bancorp on August 28, 2024 and sell it today you would earn a total of 222.00 from holding Citizens Community Bancorp or generate 15.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sierra Bancorp vs. Citizens Community Bancorp
Performance |
| Timeline |
| Sierra Bancorp |
| Citizens Community |
Sierra Bancorp and Citizens Community Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sierra Bancorp and Citizens Community
The main advantage of trading using opposite Sierra Bancorp and Citizens Community positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sierra Bancorp position performs unexpectedly, Citizens Community 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 Community will offset losses from the drop in Citizens Community's long position.| Sierra Bancorp vs. Fifth Third Bancorp | Sierra Bancorp vs. Huntington Bancshares Incorporated | Sierra Bancorp vs. Comerica | Sierra Bancorp vs. MT Bank |
| Citizens Community vs. Home Federal Bancorp | Citizens Community vs. First Financial Northwest | Citizens Community vs. First Northwest Bancorp | Citizens Community vs. First Capital |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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