Correlation Between Citi Trends and Hemosense

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

By analyzing existing cross correlation between Citi Trends and Hemosense, you can compare the effects of market volatilities on Citi Trends and Hemosense 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 Hemosense. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citi Trends and Hemosense.

Diversification Opportunities for Citi Trends and Hemosense

0.0

Correlation Coefficient

Citi Trends  Hemosense

Pay attention - limited upside

The 3 months correlation between Citi and Hemosense is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citi Trends and Hemosense in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hemosense 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 Hemosense. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hemosense has no effect on the direction of Citi Trends i.e., Citi Trends and Hemosense go up and down completely randomly.

Pair Corralation between Citi Trends and Hemosense

If you would invest  1,850  in Citi Trends on September 27, 2024 and sell it today you would earn a total of  816.00  from holding Citi Trends or generate 44.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Citi Trends  vs.  Hemosense

Citi Trends

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Citi Trends are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Citi Trends displayed solid returns over the last few months and may actually be approaching a breakup point.

Hemosense

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hemosense has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Hemosense is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Citi Trends and Hemosense

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

The idea behind Citi Trends and Hemosense 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.