Correlation Between Consumers Bancorp and First Citizens
Can any of the company-specific risk be diversified away by investing in both Consumers Bancorp and First Citizens 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 Consumers Bancorp and First Citizens into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Consumers Bancorp and The First Citizens, you can compare the effects of market volatilities on Consumers Bancorp and First Citizens 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 Consumers Bancorp with a short position of First Citizens. Check out your portfolio center. Please also check ongoing floating volatility patterns of Consumers Bancorp and First Citizens.
Diversification Opportunities for Consumers Bancorp and First Citizens
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Consumers and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Consumers Bancorp and The First Citizens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Citizens and Consumers 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 Consumers Bancorp are associated (or correlated) with First Citizens. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Citizens has no effect on the direction of Consumers Bancorp i.e., Consumers Bancorp and First Citizens go up and down completely randomly.
Pair Corralation between Consumers Bancorp and First Citizens
Given the investment horizon of 90 days Consumers Bancorp is expected to generate 2.92 times more return on investment than First Citizens. However, Consumers Bancorp is 2.92 times more volatile than The First Citizens. It trades about 0.02 of its potential returns per unit of risk. The First Citizens is currently generating about -0.02 per unit of risk. If you would invest 1,723 in Consumers Bancorp on August 30, 2024 and sell it today you would earn a total of 128.00 from holding Consumers Bancorp or generate 7.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 51.95% |
| Values | Daily Returns |
Consumers Bancorp vs. The First Citizens
Performance |
| Timeline |
| Consumers Bancorp |
| First Citizens |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Consumers Bancorp and First Citizens Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Consumers Bancorp and First Citizens
The main advantage of trading using opposite Consumers Bancorp and First Citizens positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Consumers Bancorp position performs unexpectedly, First Citizens 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 First Citizens will offset losses from the drop in First Citizens' long position.| Consumers Bancorp vs. Century Next Financial | Consumers Bancorp vs. Citizens Financial Corp | Consumers Bancorp vs. Triad Business Bank | Consumers Bancorp vs. First Ottawa Bancshares |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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