Correlation Between Citizens Bancorp and BCE
Can any of the company-specific risk be diversified away by investing in both Citizens Bancorp and BCE 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 Bancorp and BCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Bancorp Investment and BCE Inc, you can compare the effects of market volatilities on Citizens Bancorp and BCE 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 Bancorp with a short position of BCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Bancorp and BCE.
Diversification Opportunities for Citizens Bancorp and BCE
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citizens and BCE is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Bancorp Investment and BCE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCE Inc and Citizens 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 Citizens Bancorp Investment are associated (or correlated) with BCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCE Inc has no effect on the direction of Citizens Bancorp i.e., Citizens Bancorp and BCE go up and down completely randomly.
Pair Corralation between Citizens Bancorp and BCE
Given the investment horizon of 90 days Citizens Bancorp Investment is expected to generate 1.36 times more return on investment than BCE. However, Citizens Bancorp is 1.36 times more volatile than BCE Inc. It trades about -0.05 of its potential returns per unit of risk. BCE Inc is currently generating about -0.13 per unit of risk. If you would invest 3,427 in Citizens Bancorp Investment on October 22, 2024 and sell it today you would lose (692.00) from holding Citizens Bancorp Investment or give up 20.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Bancorp Investment vs. BCE Inc
Performance |
| Timeline |
| Citizens Bancorp Inv |
| BCE Inc |
Citizens Bancorp and BCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Bancorp and BCE
The main advantage of trading using opposite Citizens Bancorp and BCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Bancorp position performs unexpectedly, BCE 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 BCE will offset losses from the drop in BCE's long position.| Citizens Bancorp vs. Greenville Federal Financial | Citizens Bancorp vs. First Ottawa Bancshares | Citizens Bancorp vs. Coastal Carolina Bancshares | Citizens Bancorp vs. First Bankers Trustshares |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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