Correlation Between Citi Trends and Gap,
Can any of the company-specific risk be diversified away by investing in both Citi Trends and Gap, 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 Gap, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citi Trends and The Gap,, you can compare the effects of market volatilities on Citi Trends and Gap, 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 Gap,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citi Trends and Gap,.
Diversification Opportunities for Citi Trends and Gap,
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Citi and Gap, is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Citi Trends and The Gap, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gap, 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 Gap,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gap, has no effect on the direction of Citi Trends i.e., Citi Trends and Gap, go up and down completely randomly.
Pair Corralation between Citi Trends and Gap,
Given the investment horizon of 90 days Citi Trends is expected to under-perform the Gap,. But the stock apears to be less risky and, when comparing its historical volatility, Citi Trends is 1.05 times less risky than Gap,. The stock trades about -0.01 of its potential returns per unit of risk. The The Gap, is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 2,174 in The Gap, on August 28, 2024 and sell it today you would earn a total of 309.00 from holding The Gap, or generate 14.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citi Trends vs. The Gap,
Performance |
| Timeline |
| Citi Trends |
| Gap, |
Citi Trends and Gap, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citi Trends and Gap,
The main advantage of trading using opposite Citi Trends and Gap, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citi Trends position performs unexpectedly, Gap, 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 Gap, will offset losses from the drop in Gap,'s long position.| Citi Trends vs. JJill Inc | Citi Trends vs. Zumiez Inc | Citi Trends vs. Tillys Inc | Citi Trends vs. Duluth Holdings |
| Gap, vs. Albertsons Companies | Gap, vs. Red Branch Technologies | Gap, vs. Acm Research | Gap, vs. ServiceNow |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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