Correlation Between Citi Trends and Chicos FAS
Can any of the company-specific risk be diversified away by investing in both Citi Trends and Chicos FAS 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 Citi Trends and Chicos FAS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citi Trends and Chicos FAS, you can compare the effects of market volatilities on Citi Trends and Chicos FAS 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 Citi Trends with a short position of Chicos FAS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citi Trends and Chicos FAS.
Diversification Opportunities for Citi Trends and Chicos FAS
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Citi and Chicos is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Citi Trends and Chicos FAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chicos FAS and Citi Trends 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 Citi Trends are associated (or correlated) with Chicos FAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chicos FAS has no effect on the direction of Citi Trends i.e., Citi Trends and Chicos FAS go up and down completely randomly.
Pair Corralation between Citi Trends and Chicos FAS
If you would invest 1,944 in Citi Trends on August 31, 2024 and sell it today you would earn a total of 58.00 from holding Citi Trends or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Citi Trends vs. Chicos FAS
Performance |
| Timeline |
| Citi Trends |
| Chicos FAS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citi Trends and Chicos FAS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citi Trends and Chicos FAS
The main advantage of trading using opposite Citi Trends and Chicos FAS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citi Trends position performs unexpectedly, Chicos FAS 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 Chicos FAS will offset losses from the drop in Chicos FAS's long position.| Citi Trends vs. JJill Inc | Citi Trends vs. Zumiez Inc | Citi Trends vs. Tillys Inc | Citi Trends vs. Duluth Holdings |
| Chicos FAS vs. Citi Trends | Chicos FAS vs. JJill Inc | Chicos FAS vs. Zumiez Inc | Chicos FAS vs. Tillys Inc |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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