Correlation Between Customers Bancorp and Zions Bancorporation
Can any of the company-specific risk be diversified away by investing in both Customers Bancorp and Zions Bancorporation 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 Customers Bancorp and Zions Bancorporation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Customers Bancorp and Zions Bancorporation National, you can compare the effects of market volatilities on Customers Bancorp and Zions Bancorporation 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 Customers Bancorp with a short position of Zions Bancorporation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Customers Bancorp and Zions Bancorporation.
Diversification Opportunities for Customers Bancorp and Zions Bancorporation
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Customers and Zions is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Customers Bancorp and Zions Bancorp. National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zions Bancorporation and Customers Bancorp 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 Customers Bancorp are associated (or correlated) with Zions Bancorporation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zions Bancorporation has no effect on the direction of Customers Bancorp i.e., Customers Bancorp and Zions Bancorporation go up and down completely randomly.
Pair Corralation between Customers Bancorp and Zions Bancorporation
Given the investment horizon of 90 days Customers Bancorp is expected to generate 4.38 times more return on investment than Zions Bancorporation. However, Customers Bancorp is 4.38 times more volatile than Zions Bancorporation National. It trades about 0.08 of its potential returns per unit of risk. Zions Bancorporation National is currently generating about 0.01 per unit of risk. If you would invest 4,771 in Customers Bancorp on September 12, 2024 and sell it today you would earn a total of 673.50 from holding Customers Bancorp or generate 14.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Customers Bancorp vs. Zions Bancorp. National
Performance |
| Timeline |
| Customers Bancorp |
| Zions Bancorporation |
Customers Bancorp and Zions Bancorporation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Customers Bancorp and Zions Bancorporation
The main advantage of trading using opposite Customers Bancorp and Zions Bancorporation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Customers Bancorp position performs unexpectedly, Zions Bancorporation 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 Zions Bancorporation will offset losses from the drop in Zions Bancorporation's long position.| Customers Bancorp vs. Glacier Bancorp | Customers Bancorp vs. Capitol Federal Financial | Customers Bancorp vs. Byline Bancorp | Customers Bancorp vs. Cathay General Bancorp |
| Zions Bancorporation vs. Zions Bancorporation National | Zions Bancorporation vs. Valley National Bancorp | Zions Bancorporation vs. Valley National Bancorp | Zions Bancorporation vs. Zions Bancorporation NA |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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