Correlation Between Citizens Holding and HV Bancorp
Can any of the company-specific risk be diversified away by investing in both Citizens Holding and HV 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 Holding and HV Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Holding and HV Bancorp, you can compare the effects of market volatilities on Citizens Holding and HV 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 Holding with a short position of HV Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Holding and HV Bancorp.
Diversification Opportunities for Citizens Holding and HV Bancorp
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citizens and HVBC is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Holding and HV Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HV Bancorp and Citizens Holding 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 Holding are associated (or correlated) with HV Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HV Bancorp has no effect on the direction of Citizens Holding i.e., Citizens Holding and HV Bancorp go up and down completely randomly.
Pair Corralation between Citizens Holding and HV Bancorp
Given the investment horizon of 90 days Citizens Holding is expected to under-perform the HV Bancorp. In addition to that, Citizens Holding is 1.13 times more volatile than HV Bancorp. It trades about -0.02 of its total potential returns per unit of risk. HV Bancorp is currently generating about 0.1 per unit of volatility. If you would invest 2,683 in HV Bancorp on August 27, 2024 and sell it today you would earn a total of 777.00 from holding HV Bancorp or generate 28.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 84.81% |
| Values | Daily Returns |
Citizens Holding vs. HV Bancorp
Performance |
| Timeline |
| Citizens Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| HV Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citizens Holding and HV Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Holding and HV Bancorp
The main advantage of trading using opposite Citizens Holding and HV Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Holding position performs unexpectedly, HV 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 HV Bancorp will offset losses from the drop in HV Bancorp's long position.| Citizens Holding vs. Home Federal Bancorp | Citizens Holding vs. Lake Shore Bancorp | Citizens Holding vs. Community West Bancshares | Citizens Holding vs. Magyar Bancorp |
| HV Bancorp vs. Magyar Bancorp | HV Bancorp vs. Home Federal Bancorp | HV Bancorp vs. Community West Bancshares | HV Bancorp vs. Lake Shore 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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