Correlation Between Citizens Financial and WSFS Financial
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and WSFS Financial 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 Financial and WSFS Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Financial Group and WSFS Financial, you can compare the effects of market volatilities on Citizens Financial and WSFS Financial 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 Financial with a short position of WSFS Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and WSFS Financial.
Diversification Opportunities for Citizens Financial and WSFS Financial
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citizens and WSFS is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group and WSFS Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WSFS Financial and Citizens Financial 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 Financial Group are associated (or correlated) with WSFS Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WSFS Financial has no effect on the direction of Citizens Financial i.e., Citizens Financial and WSFS Financial go up and down completely randomly.
Pair Corralation between Citizens Financial and WSFS Financial
Assuming the 90 days trading horizon Citizens Financial is expected to generate 2.56 times less return on investment than WSFS Financial. But when comparing it to its historical volatility, Citizens Financial Group is 1.55 times less risky than WSFS Financial. It trades about 0.04 of its potential returns per unit of risk. WSFS Financial is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,865 in WSFS Financial on August 31, 2024 and sell it today you would earn a total of 2,137 from holding WSFS Financial or generate 55.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Financial Group vs. WSFS Financial
Performance |
| Timeline |
| Citizens Financial |
| WSFS Financial |
Citizens Financial and WSFS Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and WSFS Financial
The main advantage of trading using opposite Citizens Financial and WSFS Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, WSFS Financial 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 WSFS Financial will offset losses from the drop in WSFS Financial's long position.| Citizens Financial vs. Capital One Financial | Citizens Financial vs. Capital One Financial | Citizens Financial vs. Bank of America | Citizens Financial vs. KeyCorp |
| WSFS Financial vs. Western New England | WSFS Financial vs. Great Southern Bancorp | WSFS Financial vs. First Financial | WSFS Financial vs. Heritage Financial |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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