Correlation Between Citrine Global and Maximus

Can any of the company-specific risk be diversified away by investing in both Citrine Global and Maximus 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 Citrine Global and Maximus into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Citrine Global Corp and Maximus, you can compare the effects of market volatilities on Citrine Global and Maximus 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 Citrine Global with a short position of Maximus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citrine Global and Maximus.

Diversification Opportunities for Citrine Global and Maximus

0.59

Correlation Coefficient

Citrine Global  Maximus

Very weak diversification

The 3 months correlation between Citrine and Maximus is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Citrine Global Corp and Maximus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maximus and Citrine Global 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 Citrine Global Corp are associated (or correlated) with Maximus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maximus has no effect on the direction of Citrine Global i.e., Citrine Global and Maximus go up and down completely randomly.

Pair Corralation between Citrine Global and Maximus

Given the investment horizon of 90 days Citrine Global Corp is expected to under-perform the Maximus. In addition to that, Citrine Global is 4.54 times more volatile than Maximus. It trades about -0.18 of its total potential returns per unit of risk. Maximus is currently generating about -0.17 per unit of volatility. If you would invest  9,007  in Maximus on September 3, 2024 and sell it today you would lose (1,591) from holding Maximus or give up 17.66% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Citrine Global Corp  vs.  Maximus

Citrine Global Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Citrine Global Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Maximus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maximus has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's primary indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Citrine Global and Maximus

The main advantage of trading using opposite Citrine Global and Maximus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citrine Global position performs unexpectedly, Maximus 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 Maximus will offset losses from the drop in Maximus' long position.

The idea behind Citrine Global Corp and Maximus 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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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.