Correlation Between Global Ship and Citi Trends
Can any of the company-specific risk be diversified away by investing in both Global Ship and Citi Trends 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 Global Ship and Citi Trends into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Ship Lease and Citi Trends, you can compare the effects of market volatilities on Global Ship and Citi Trends 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 Global Ship with a short position of Citi Trends. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and Citi Trends.
Diversification Opportunities for Global Ship and Citi Trends
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Citi is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and Citi Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citi Trends and Global Ship 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 Global Ship Lease are associated (or correlated) with Citi Trends. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citi Trends has no effect on the direction of Global Ship i.e., Global Ship and Citi Trends go up and down completely randomly.
Pair Corralation between Global Ship and Citi Trends
Assuming the 90 days trading horizon Global Ship Lease is expected to generate 0.27 times more return on investment than Citi Trends. However, Global Ship Lease is 3.71 times less risky than Citi Trends. It trades about 0.06 of its potential returns per unit of risk. Citi Trends is currently generating about 0.0 per unit of risk. If you would invest 2,175 in Global Ship Lease on September 19, 2024 and sell it today you would earn a total of 503.00 from holding Global Ship Lease or generate 23.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Ship Lease vs. Citi Trends
Performance |
| Timeline |
| Global Ship Lease |
| Citi Trends |
Global Ship and Citi Trends Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and Citi Trends
The main advantage of trading using opposite Global Ship and Citi Trends positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, Citi Trends 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 Citi Trends will offset losses from the drop in Citi Trends' long position.| Global Ship vs. Safe Bulkers | Global Ship vs. Diana Shipping | Global Ship vs. Costamare | Global Ship vs. Safe Bulkers |
| Citi Trends vs. Capri Holdings | Citi Trends vs. Movado Group | Citi Trends vs. Tapestry | Citi Trends vs. Brilliant Earth Group |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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