Correlation Between Citizens Financial and Santa Cruz
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and Santa Cruz 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 Santa Cruz into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Financial Corp and Santa Cruz County, you can compare the effects of market volatilities on Citizens Financial and Santa Cruz 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 Santa Cruz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Santa Cruz.
Diversification Opportunities for Citizens Financial and Santa Cruz
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citizens and Santa is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Corp and Santa Cruz County in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santa Cruz County 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 Corp are associated (or correlated) with Santa Cruz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santa Cruz County has no effect on the direction of Citizens Financial i.e., Citizens Financial and Santa Cruz go up and down completely randomly.
Pair Corralation between Citizens Financial and Santa Cruz
Given the investment horizon of 90 days Citizens Financial Corp is expected to under-perform the Santa Cruz. In addition to that, Citizens Financial is 4.81 times more volatile than Santa Cruz County. It trades about -0.27 of its total potential returns per unit of risk. Santa Cruz County is currently generating about 0.15 per unit of volatility. If you would invest 4,135 in Santa Cruz County on September 25, 2024 and sell it today you would earn a total of 35.00 from holding Santa Cruz County or generate 0.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Citizens Financial Corp vs. Santa Cruz County
Performance |
| Timeline |
| Citizens Financial Corp |
| Santa Cruz County |
Citizens Financial and Santa Cruz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and Santa Cruz
The main advantage of trading using opposite Citizens Financial and Santa Cruz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, Santa Cruz 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 Santa Cruz will offset losses from the drop in Santa Cruz's long position.| Citizens Financial vs. Century Next Financial | Citizens Financial vs. Triad Business Bank | Citizens Financial vs. First Ottawa Bancshares | Citizens Financial vs. First Community Financial |
| Santa Cruz vs. Citizens Financial Corp | Santa Cruz vs. Farmers Bancorp | Santa Cruz vs. Alpine Banks of | Santa Cruz vs. Taylor Calvin B |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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