Correlation Between First Citizens and Barry Callebaut
Can any of the company-specific risk be diversified away by investing in both First Citizens and Barry Callebaut 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 First Citizens and Barry Callebaut into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Citizens BancShares and Barry Callebaut AG, you can compare the effects of market volatilities on First Citizens and Barry Callebaut 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 First Citizens with a short position of Barry Callebaut. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Citizens and Barry Callebaut.
Diversification Opportunities for First Citizens and Barry Callebaut
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between First and Barry is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding First Citizens BancShares and Barry Callebaut AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barry Callebaut AG and First Citizens 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 First Citizens BancShares are associated (or correlated) with Barry Callebaut. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barry Callebaut AG has no effect on the direction of First Citizens i.e., First Citizens and Barry Callebaut go up and down completely randomly.
Pair Corralation between First Citizens and Barry Callebaut
Assuming the 90 days horizon First Citizens BancShares is expected to generate 1.3 times more return on investment than Barry Callebaut. However, First Citizens is 1.3 times more volatile than Barry Callebaut AG. It trades about 0.08 of its potential returns per unit of risk. Barry Callebaut AG is currently generating about -0.01 per unit of risk. If you would invest 74,576 in First Citizens BancShares on September 14, 2024 and sell it today you would earn a total of 132,912 from holding First Citizens BancShares or generate 178.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.02% |
| Values | Daily Returns |
First Citizens BancShares vs. Barry Callebaut AG
Performance |
| Timeline |
| First Citizens BancShares |
| Barry Callebaut AG |
First Citizens and Barry Callebaut Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Citizens and Barry Callebaut
The main advantage of trading using opposite First Citizens and Barry Callebaut positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Citizens position performs unexpectedly, Barry Callebaut 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 Barry Callebaut will offset losses from the drop in Barry Callebaut's long position.| First Citizens vs. Zions Bancorporation | First Citizens vs. KeyCorp | First Citizens vs. Comerica | First Citizens vs. First Horizon National |
| Barry Callebaut vs. Hershey Co | Barry Callebaut vs. Mondelez International | Barry Callebaut vs. Chocoladefabriken Lindt Sprngli | Barry Callebaut vs. Bunzl plc |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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