Correlation Between Citi Trends and U Haul
Can any of the company-specific risk be diversified away by investing in both Citi Trends and U Haul 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 U Haul into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citi Trends and U Haul Holding, you can compare the effects of market volatilities on Citi Trends and U Haul 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 U Haul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citi Trends and U Haul.
Diversification Opportunities for Citi Trends and U Haul
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Citi and UHAL is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Citi Trends and U Haul Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Haul Holding 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 U Haul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Haul Holding has no effect on the direction of Citi Trends i.e., Citi Trends and U Haul go up and down completely randomly.
Pair Corralation between Citi Trends and U Haul
Given the investment horizon of 90 days Citi Trends is expected to generate 1.79 times less return on investment than U Haul. In addition to that, Citi Trends is 1.81 times more volatile than U Haul Holding. It trades about 0.02 of its total potential returns per unit of risk. U Haul Holding is currently generating about 0.07 per unit of volatility. If you would invest 5,027 in U Haul Holding on September 19, 2024 and sell it today you would earn a total of 1,799 from holding U Haul Holding or generate 35.79% 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. U Haul Holding
Performance |
| Timeline |
| Citi Trends |
| U Haul Holding |
Citi Trends and U Haul Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citi Trends and U Haul
The main advantage of trading using opposite Citi Trends and U Haul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citi Trends position performs unexpectedly, U Haul 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 U Haul will offset losses from the drop in U Haul's long position.| Citi Trends vs. Capri Holdings | Citi Trends vs. Movado Group | Citi Trends vs. Tapestry | Citi Trends vs. Brilliant Earth 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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