Correlation Between Citizens Financial and CullenFrost Bankers
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and CullenFrost Bankers 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 CullenFrost Bankers 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 CullenFrost Bankers, you can compare the effects of market volatilities on Citizens Financial and CullenFrost Bankers 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 CullenFrost Bankers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and CullenFrost Bankers.
Diversification Opportunities for Citizens Financial and CullenFrost Bankers
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citizens and CullenFrost is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group, and CullenFrost Bankers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CullenFrost Bankers 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 CullenFrost Bankers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CullenFrost Bankers has no effect on the direction of Citizens Financial i.e., Citizens Financial and CullenFrost Bankers go up and down completely randomly.
Pair Corralation between Citizens Financial and CullenFrost Bankers
Assuming the 90 days trading horizon Citizens Financial Group, is expected to generate 0.31 times more return on investment than CullenFrost Bankers. However, Citizens Financial Group, is 3.21 times less risky than CullenFrost Bankers. It trades about 0.16 of its potential returns per unit of risk. CullenFrost Bankers is currently generating about 0.02 per unit of risk. If you would invest 2,455 in Citizens Financial Group, on August 30, 2024 and sell it today you would earn a total of 236.00 from holding Citizens Financial Group, or generate 9.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 27.27% |
| Values | Daily Returns |
Citizens Financial Group, vs. CullenFrost Bankers
Performance |
| Timeline |
| Citizens Financial Group, |
| CullenFrost Bankers |
Citizens Financial and CullenFrost Bankers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and CullenFrost Bankers
The main advantage of trading using opposite Citizens Financial and CullenFrost Bankers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, CullenFrost Bankers 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 CullenFrost Bankers will offset losses from the drop in CullenFrost Bankers' long position.| Citizens Financial vs. Axos Financial | Citizens Financial vs. Byline Bancorp | Citizens Financial vs. KB Financial Group | Citizens Financial vs. Nu Holdings |
| CullenFrost Bankers vs. Truist Financial | CullenFrost Bankers vs. Citizens Financial Group | CullenFrost Bankers vs. Bank of America | CullenFrost Bankers vs. US Bancorp |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |