Correlation Between Citizens and SmartCentres Real
Can any of the company-specific risk be diversified away by investing in both Citizens and SmartCentres Real 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 and SmartCentres Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citizens and SmartCentres Real Estate, you can compare the effects of market volatilities on Citizens and SmartCentres Real 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 with a short position of SmartCentres Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citizens and SmartCentres Real.
Diversification Opportunities for Citizens and SmartCentres Real
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Citizens and SmartCentres is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Citizens and SmartCentres Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SmartCentres Real Estate and 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 Citizens are associated (or correlated) with SmartCentres Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SmartCentres Real Estate has no effect on the direction of Citizens i.e., Citizens and SmartCentres Real go up and down completely randomly.
Pair Corralation between Citizens and SmartCentres Real
Considering the 90-day investment horizon Citizens is expected to generate 1.62 times less return on investment than SmartCentres Real. In addition to that, Citizens is 3.15 times more volatile than SmartCentres Real Estate. It trades about 0.05 of its total potential returns per unit of risk. SmartCentres Real Estate is currently generating about 0.27 per unit of volatility. If you would invest 2,409 in SmartCentres Real Estate on December 4, 2024 and sell it today you would earn a total of 156.00 from holding SmartCentres Real Estate or generate 6.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citizens vs. SmartCentres Real Estate
Performance |
| Timeline |
| Citizens |
| SmartCentres Real Estate |
Citizens and SmartCentres Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citizens and SmartCentres Real
The main advantage of trading using opposite Citizens and SmartCentres Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citizens position performs unexpectedly, SmartCentres Real 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 SmartCentres Real will offset losses from the drop in SmartCentres Real's long position.| Citizens vs. CNO Financial Group | ||
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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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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