Correlation Between Citizens Financial and Enterprise Bancorp
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and Enterprise 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 Financial and Enterprise Bancorp 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 Enterprise Bancorp, you can compare the effects of market volatilities on Citizens Financial and Enterprise 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 Financial with a short position of Enterprise Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Enterprise Bancorp.
Diversification Opportunities for Citizens Financial and Enterprise Bancorp
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citizens and Enterprise is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group, and Enterprise Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enterprise Bancorp 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 Enterprise Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enterprise Bancorp has no effect on the direction of Citizens Financial i.e., Citizens Financial and Enterprise Bancorp go up and down completely randomly.
Pair Corralation between Citizens Financial and Enterprise Bancorp
Assuming the 90 days trading horizon Citizens Financial is expected to generate 3.54 times less return on investment than Enterprise Bancorp. But when comparing it to its historical volatility, Citizens Financial Group, is 1.97 times less risky than Enterprise Bancorp. It trades about 0.16 of its potential returns per unit of risk. Enterprise Bancorp is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 3,879 in Enterprise Bancorp on November 2, 2024 and sell it today you would earn a total of 395.00 from holding Enterprise Bancorp or generate 10.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Financial Group, vs. Enterprise Bancorp
Performance |
| Timeline |
| Citizens Financial Group, |
| Enterprise Bancorp |
Citizens Financial and Enterprise Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and Enterprise Bancorp
The main advantage of trading using opposite Citizens Financial and Enterprise Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, Enterprise 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 Enterprise Bancorp will offset losses from the drop in Enterprise Bancorp's long position.| Citizens Financial vs. Axos Financial | Citizens Financial vs. Byline Bancorp | Citizens Financial vs. KB Financial Group | Citizens Financial vs. Nu Holdings |
| Enterprise Bancorp vs. Home Federal Bancorp | Enterprise Bancorp vs. First Northwest Bancorp | Enterprise Bancorp vs. Community West Bancshares | Enterprise Bancorp vs. First Financial Northwest |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Transaction History View history of all your transactions and understand their impact on performance |