Correlation Between Citizens Financial and Penns Woods
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and Penns Woods 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 Penns Woods 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 Penns Woods Bancorp, you can compare the effects of market volatilities on Citizens Financial and Penns Woods 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 Penns Woods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Penns Woods.
Diversification Opportunities for Citizens Financial and Penns Woods
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citizens and Penns is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group, and Penns Woods Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penns Woods 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 Penns Woods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penns Woods Bancorp has no effect on the direction of Citizens Financial i.e., Citizens Financial and Penns Woods go up and down completely randomly.
Pair Corralation between Citizens Financial and Penns Woods
Assuming the 90 days trading horizon Citizens Financial is expected to generate 2.37 times less return on investment than Penns Woods. But when comparing it to its historical volatility, Citizens Financial Group, is 4.51 times less risky than Penns Woods. It trades about 0.17 of its potential returns per unit of risk. Penns Woods Bancorp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,146 in Penns Woods Bancorp on August 25, 2024 and sell it today you would earn a total of 895.00 from holding Penns Woods Bancorp or generate 41.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 58.08% |
| Values | Daily Returns |
Citizens Financial Group, vs. Penns Woods Bancorp
Performance |
| Timeline |
| Citizens Financial Group, |
| Penns Woods Bancorp |
Citizens Financial and Penns Woods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and Penns Woods
The main advantage of trading using opposite Citizens Financial and Penns Woods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, Penns Woods 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 Penns Woods will offset losses from the drop in Penns Woods' long position.| Citizens Financial vs. Axos Financial | Citizens Financial vs. Byline Bancorp | Citizens Financial vs. KB Financial Group | Citizens Financial vs. Nu Holdings |
| Penns Woods vs. 1st Source | Penns Woods vs. Great Southern Bancorp | Penns Woods vs. Waterstone Financial | Penns Woods vs. First Community |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |