Correlation Between Citizens Financial and Capitol Federal
Can any of the company-specific risk be diversified away by investing in both Citizens Financial and Capitol Federal 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 Financial and Capitol Federal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens Financial Group, and Capitol Federal Financial, you can compare the effects of market volatilities on Citizens Financial and Capitol Federal 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 Financial with a short position of Capitol Federal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens Financial and Capitol Federal.
Diversification Opportunities for Citizens Financial and Capitol Federal
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citizens and Capitol is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Citizens Financial Group, and Capitol Federal Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capitol Federal Financial and Citizens 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 Citizens Financial Group, are associated (or correlated) with Capitol Federal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capitol Federal Financial has no effect on the direction of Citizens Financial i.e., Citizens Financial and Capitol Federal go up and down completely randomly.
Pair Corralation between Citizens Financial and Capitol Federal
Considering the 90-day investment horizon Citizens Financial Group, is expected to generate 0.95 times more return on investment than Capitol Federal. However, Citizens Financial Group, is 1.05 times less risky than Capitol Federal. It trades about 0.09 of its potential returns per unit of risk. Capitol Federal Financial is currently generating about 0.03 per unit of risk. If you would invest 4,811 in Citizens Financial Group, on August 13, 2025 and sell it today you would earn a total of 424.00 from holding Citizens Financial Group, or generate 8.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens Financial Group, vs. Capitol Federal Financial
Performance |
| Timeline |
| Citizens Financial Group, |
| Capitol Federal Financial |
Citizens Financial and Capitol Federal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens Financial and Capitol Federal
The main advantage of trading using opposite Citizens Financial and Capitol Federal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens Financial position performs unexpectedly, Capitol Federal 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 Capitol Federal will offset losses from the drop in Capitol Federal's long position.| Citizens Financial vs. PNC Financial Services | Citizens Financial vs. Regions Financial | Citizens Financial vs. Fifth Third Bancorp | Citizens Financial vs. Comerica Incorporated |
| Capitol Federal vs. Hanmi Financial | Capitol Federal vs. MidWestOne Financial Group | Capitol Federal vs. Central Pacific Financial | Capitol Federal vs. Heritage Financial |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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