Correlation Between Citizens Bancorp and Parke Bancorp
Can any of the company-specific risk be diversified away by investing in both Citizens Bancorp and Parke Bancorp 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 Parke Bancorp 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 Parke Bancorp, you can compare the effects of market volatilities on Citizens Bancorp and Parke Bancorp 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 Parke Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Bancorp and Parke Bancorp.
Diversification Opportunities for Citizens Bancorp and Parke Bancorp
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citizens and Parke is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Bancorp Investment and Parke Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parke Bancorp 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 Parke Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parke Bancorp has no effect on the direction of Citizens Bancorp i.e., Citizens Bancorp and Parke Bancorp go up and down completely randomly.
Pair Corralation between Citizens Bancorp and Parke Bancorp
Given the investment horizon of 90 days Citizens Bancorp Investment is expected to under-perform the Parke Bancorp. But the otc stock apears to be less risky and, when comparing its historical volatility, Citizens Bancorp Investment is 1.46 times less risky than Parke Bancorp. The otc stock trades about -0.05 of its potential returns per unit of risk. The Parke Bancorp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,937 in Parke Bancorp on September 3, 2024 and sell it today you would earn a total of 424.00 from holding Parke Bancorp or generate 21.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Bancorp Investment vs. Parke Bancorp
Performance |
| Timeline |
| Citizens Bancorp Inv |
| Parke Bancorp |
Citizens Bancorp and Parke Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Bancorp and Parke Bancorp
The main advantage of trading using opposite Citizens Bancorp and Parke Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Bancorp position performs unexpectedly, Parke Bancorp 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 Parke Bancorp will offset losses from the drop in Parke Bancorp'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 |
| Parke Bancorp vs. Sound Financial Bancorp | Parke Bancorp vs. Finward Bancorp | Parke Bancorp vs. Franklin Financial Services | Parke Bancorp vs. Community West Bancshares |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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