Correlation Between Citizens Bancorp and Ramaco Resources
Can any of the company-specific risk be diversified away by investing in both Citizens Bancorp and Ramaco Resources 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 Ramaco Resources 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 Ramaco Resources, you can compare the effects of market volatilities on Citizens Bancorp and Ramaco Resources 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 Ramaco Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Bancorp and Ramaco Resources.
Diversification Opportunities for Citizens Bancorp and Ramaco Resources
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citizens and Ramaco is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Bancorp Investment and Ramaco Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramaco Resources 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 Ramaco Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramaco Resources has no effect on the direction of Citizens Bancorp i.e., Citizens Bancorp and Ramaco Resources go up and down completely randomly.
Pair Corralation between Citizens Bancorp and Ramaco Resources
Given the investment horizon of 90 days Citizens Bancorp Investment is expected to under-perform the Ramaco Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Citizens Bancorp Investment is 1.55 times less risky than Ramaco Resources. The otc stock trades about -0.02 of its potential returns per unit of risk. The Ramaco Resources is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,090 in Ramaco Resources on September 3, 2024 and sell it today you would lose (64.00) from holding Ramaco Resources or give up 5.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Bancorp Investment vs. Ramaco Resources
Performance |
| Timeline |
| Citizens Bancorp Inv |
| Ramaco Resources |
Citizens Bancorp and Ramaco Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Bancorp and Ramaco Resources
The main advantage of trading using opposite Citizens Bancorp and Ramaco Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Bancorp position performs unexpectedly, Ramaco Resources 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 Ramaco Resources will offset losses from the drop in Ramaco Resources' 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 |
| Ramaco Resources vs. Universal Display | Ramaco Resources vs. Alaska Air Group | Ramaco Resources vs. Playa Hotels Resorts | Ramaco Resources vs. JD Sports Fashion |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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