Correlation Between Woori Financial and Citizens Financial
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Citizens Financial 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 Woori Financial and Citizens Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and Citizens Financial Group,, you can compare the effects of market volatilities on Woori Financial and Citizens Financial 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 Woori Financial with a short position of Citizens Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Citizens Financial.
Diversification Opportunities for Woori Financial and Citizens Financial
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Woori and Citizens is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Citizens Financial Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Financial Group, and Woori 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 Woori Financial Group are associated (or correlated) with Citizens Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Financial Group, has no effect on the direction of Woori Financial i.e., Woori Financial and Citizens Financial go up and down completely randomly.
Pair Corralation between Woori Financial and Citizens Financial
Allowing for the 90-day total investment horizon Woori Financial Group is expected to generate 2.91 times more return on investment than Citizens Financial. However, Woori Financial is 2.91 times more volatile than Citizens Financial Group,. It trades about 0.05 of its potential returns per unit of risk. Citizens Financial Group, is currently generating about -0.06 per unit of risk. If you would invest 3,201 in Woori Financial Group on January 14, 2025 and sell it today you would earn a total of 167.00 from holding Woori Financial Group or generate 5.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Woori Financial Group vs. Citizens Financial Group,
Performance |
| Timeline |
| Woori Financial Group |
| Citizens Financial Group, |
Woori Financial and Citizens Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Citizens Financial
The main advantage of trading using opposite Woori Financial and Citizens Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Citizens Financial 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 Financial will offset losses from the drop in Citizens Financial's long position.| Woori Financial vs. Axos Financial | Woori Financial vs. Byline Bancorp | Woori Financial vs. Nu Holdings | Woori Financial vs. Prosperity Bancshares |
| Citizens Financial vs. Axos Financial | Citizens Financial vs. Byline Bancorp | Citizens Financial vs. KB Financial Group | Citizens Financial vs. Nu Holdings |
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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