Correlation Between Citi Trends and SkyWest
Can any of the company-specific risk be diversified away by investing in both Citi Trends and SkyWest 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 SkyWest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citi Trends and SkyWest, you can compare the effects of market volatilities on Citi Trends and SkyWest 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 SkyWest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citi Trends and SkyWest.
Diversification Opportunities for Citi Trends and SkyWest
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citi and SkyWest is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Citi Trends and SkyWest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SkyWest 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 SkyWest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SkyWest has no effect on the direction of Citi Trends i.e., Citi Trends and SkyWest go up and down completely randomly.
Pair Corralation between Citi Trends and SkyWest
Given the investment horizon of 90 days Citi Trends is expected to generate 1.11 times less return on investment than SkyWest. In addition to that, Citi Trends is 1.5 times more volatile than SkyWest. It trades about 0.22 of its total potential returns per unit of risk. SkyWest is currently generating about 0.36 per unit of volatility. If you would invest 7,530 in SkyWest on September 3, 2024 and sell it today you would earn a total of 3,944 from holding SkyWest or generate 52.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citi Trends vs. SkyWest
Performance |
| Timeline |
| Citi Trends |
| SkyWest |
Citi Trends and SkyWest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citi Trends and SkyWest
The main advantage of trading using opposite Citi Trends and SkyWest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citi Trends position performs unexpectedly, SkyWest 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 SkyWest will offset losses from the drop in SkyWest's long position.| Citi Trends vs. JJill Inc | Citi Trends vs. Zumiez Inc | Citi Trends vs. Tillys Inc | Citi Trends vs. Duluth Holdings |
| SkyWest vs. Copa Holdings SA | SkyWest vs. Sun Country Airlines | SkyWest vs. Air Transport Services | SkyWest vs. Frontier Group 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |