Correlation Between Citizens Financial and Teladoc Health
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and Teladoc Health 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 Teladoc Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Financial Group, and Teladoc Health, you can compare the effects of market volatilities on Citizens Financial and Teladoc Health 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 Teladoc Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Teladoc Health.
Diversification Opportunities for Citizens Financial and Teladoc Health
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citizens and Teladoc is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group, and Teladoc Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teladoc Health 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 Group, are associated (or correlated) with Teladoc Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teladoc Health has no effect on the direction of Citizens Financial i.e., Citizens Financial and Teladoc Health go up and down completely randomly.
Pair Corralation between Citizens Financial and Teladoc Health
Assuming the 90 days trading horizon Citizens Financial Group, is expected to generate 0.58 times more return on investment than Teladoc Health. However, Citizens Financial Group, is 1.72 times less risky than Teladoc Health. It trades about 0.01 of its potential returns per unit of risk. Teladoc Health is currently generating about -0.23 per unit of risk. If you would invest 27,655 in Citizens Financial Group, on October 17, 2024 and sell it today you would earn a total of 20.00 from holding Citizens Financial Group, or generate 0.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Financial Group, vs. Teladoc Health
Performance |
| Timeline |
| Citizens Financial Group, |
| Teladoc Health |
Citizens Financial and Teladoc Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and Teladoc Health
The main advantage of trading using opposite Citizens Financial and Teladoc Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, Teladoc Health 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 Teladoc Health will offset losses from the drop in Teladoc Health's long position.| Citizens Financial vs. Take Two Interactive Software | Citizens Financial vs. United Airlines Holdings | Citizens Financial vs. American Airlines Group | Citizens Financial vs. STMicroelectronics NV |
| Teladoc Health vs. Discover Financial Services | Teladoc Health vs. Liberty Broadband | Teladoc Health vs. Citizens Financial Group, | Teladoc Health vs. Jefferies Financial Group |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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