Correlation Between Citizens Bancorp and Nasdaq
Can any of the company-specific risk be diversified away by investing in both Citizens Bancorp and Nasdaq 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 Nasdaq 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 Nasdaq Inc, you can compare the effects of market volatilities on Citizens Bancorp and Nasdaq 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 Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Bancorp and Nasdaq.
Diversification Opportunities for Citizens Bancorp and Nasdaq
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citizens and Nasdaq is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Bancorp Investment and Nasdaq Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 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 Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq Inc has no effect on the direction of Citizens Bancorp i.e., Citizens Bancorp and Nasdaq go up and down completely randomly.
Pair Corralation between Citizens Bancorp and Nasdaq
Given the investment horizon of 90 days Citizens Bancorp Investment is expected to under-perform the Nasdaq. In addition to that, Citizens Bancorp is 1.06 times more volatile than Nasdaq Inc. It trades about -0.05 of its total potential returns per unit of risk. Nasdaq Inc is currently generating about 0.05 per unit of volatility. If you would invest 6,149 in Nasdaq Inc on August 30, 2024 and sell it today you would earn a total of 2,156 from holding Nasdaq Inc or generate 35.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Bancorp Investment vs. Nasdaq Inc
Performance |
| Timeline |
| Citizens Bancorp Inv |
| Nasdaq Inc |
Citizens Bancorp and Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Bancorp and Nasdaq
The main advantage of trading using opposite Citizens Bancorp and Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Bancorp position performs unexpectedly, Nasdaq 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 Nasdaq will offset losses from the drop in Nasdaq'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 |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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