Correlation Between 50247VAC3 and Citi Trends

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Can any of the company-specific risk be diversified away by investing in both 50247VAC3 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 50247VAC3 and Citi Trends into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LYB INTL FIN and Citi Trends, you can compare the effects of market volatilities on 50247VAC3 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 50247VAC3 with a short position of Citi Trends. Check out your portfolio center. Please also check ongoing floating volatility patterns of 50247VAC3 and Citi Trends.

Diversification Opportunities for 50247VAC3 and Citi Trends

-0.32
  Correlation Coefficient

Very good diversification

The 3 months correlation between 50247VAC3 and Citi is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding LYB INTL FIN and Citi Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citi Trends and 50247VAC3 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 LYB INTL FIN 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 50247VAC3 i.e., 50247VAC3 and Citi Trends go up and down completely randomly.

Pair Corralation between 50247VAC3 and Citi Trends

Assuming the 90 days trading horizon 50247VAC3 is expected to generate 10.31 times less return on investment than Citi Trends. But when comparing it to its historical volatility, LYB INTL FIN is 2.2 times less risky than Citi Trends. It trades about 0.01 of its potential returns per unit of risk. Citi Trends is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  2,261  in Citi Trends on September 5, 2024 and sell it today you would earn a total of  119.00  from holding Citi Trends or generate 5.26% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy82.4%
ValuesDaily Returns

LYB INTL FIN  vs.  Citi Trends

 Performance 
       Timeline  
LYB INTL FIN 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days LYB INTL FIN has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for LYB INTL FIN investors.
Citi Trends 

Risk-Adjusted Performance

20 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Citi Trends are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Citi Trends displayed solid returns over the last few months and may actually be approaching a breakup point.

50247VAC3 and Citi Trends Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with 50247VAC3 and Citi Trends

The main advantage of trading using opposite 50247VAC3 and Citi Trends positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 50247VAC3 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.
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The idea behind LYB INTL FIN and Citi Trends pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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