Correlation Between SCOR PK and Citizens Bancorp
Can any of the company-specific risk be diversified away by investing in both SCOR PK and Citizens 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 SCOR PK and Citizens Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR PK and Citizens Bancorp of, you can compare the effects of market volatilities on SCOR PK and Citizens 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 SCOR PK with a short position of Citizens Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR PK and Citizens Bancorp.
Diversification Opportunities for SCOR PK and Citizens Bancorp
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SCOR and Citizens is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding SCOR PK and Citizens Bancorp of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Bancorp and SCOR PK 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 SCOR PK are associated (or correlated) with Citizens Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Bancorp has no effect on the direction of SCOR PK i.e., SCOR PK and Citizens Bancorp go up and down completely randomly.
Pair Corralation between SCOR PK and Citizens Bancorp
Assuming the 90 days horizon SCOR PK is expected to under-perform the Citizens Bancorp. In addition to that, SCOR PK is 2.16 times more volatile than Citizens Bancorp of. It trades about -0.03 of its total potential returns per unit of risk. Citizens Bancorp of is currently generating about 0.09 per unit of volatility. If you would invest 2,601 in Citizens Bancorp of on September 3, 2024 and sell it today you would earn a total of 499.00 from holding Citizens Bancorp of or generate 19.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCOR PK vs. Citizens Bancorp of
Performance |
| Timeline |
| SCOR PK |
| Citizens Bancorp |
SCOR PK and Citizens Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR PK and Citizens Bancorp
The main advantage of trading using opposite SCOR PK and Citizens Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR PK position performs unexpectedly, Citizens 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 Citizens Bancorp will offset losses from the drop in Citizens Bancorp's long position.The idea behind SCOR PK and Citizens Bancorp of pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Citizens Bancorp vs. Western Asset Global | Citizens Bancorp vs. Invesco Trust For | Citizens Bancorp vs. Logan Ridge Finance | Citizens Bancorp vs. Invesco Advantage MIT |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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