Correlation Between Coin Citadel and Cal-Bay Intl

Can any of the company-specific risk be diversified away by investing in both Coin Citadel and Cal-Bay Intl 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 Coin Citadel and Cal-Bay Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Coin Citadel and Cal Bay Intl, you can compare the effects of market volatilities on Coin Citadel and Cal-Bay Intl 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 Coin Citadel with a short position of Cal-Bay Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coin Citadel and Cal-Bay Intl.

Diversification Opportunities for Coin Citadel and Cal-Bay Intl

0.0

Correlation Coefficient

Coin Citadel  Cal-Bay Intl

Pay attention - limited upside

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

Pair Corralation between Coin Citadel and Cal-Bay Intl

Given the investment horizon of 90 days Coin Citadel is expected to generate 1.43 times less return on investment than Cal-Bay Intl. But when comparing it to its historical volatility, Coin Citadel is 1.58 times less risky than Cal-Bay Intl. It trades about 0.12 of its potential returns per unit of risk. Cal Bay Intl is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  0.02  in Cal Bay Intl on September 3, 2024 and sell it today you would lose (0.01) from holding Cal Bay Intl or give up 50.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Coin Citadel  vs.  Cal Bay Intl

Coin Citadel

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Coin Citadel are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, Coin Citadel disclosed solid returns over the last few months and may actually be approaching a breakup point.

Cal Bay Intl

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cal Bay Intl has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Cal-Bay Intl is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Coin Citadel and Cal-Bay Intl

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

The idea behind Coin Citadel and Cal Bay Intl 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.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.