Correlation Between Citadel Income and Storage Vault

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

By analyzing existing cross correlation between Citadel Income and Storage Vault Canada, you can compare the effects of market volatilities on Citadel Income and Storage Vault 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 Citadel Income with a short position of Storage Vault. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citadel Income and Storage Vault.

Diversification Opportunities for Citadel Income and Storage Vault

-0.34

Correlation Coefficient

Citadel Income  Storage Vault

Very good diversification

The 3 months correlation between Citadel and Storage is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Citadel Income and Storage Vault Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Storage Vault Canada and Citadel Income 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 Citadel Income are associated (or correlated) with Storage Vault. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Storage Vault Canada has no effect on the direction of Citadel Income i.e., Citadel Income and Storage Vault go up and down completely randomly.

Pair Corralation between Citadel Income and Storage Vault

Assuming the 90 days trading horizon Citadel Income is expected to generate 1.06 times more return on investment than Storage Vault. However, Citadel Income is 1.06 times more volatile than Storage Vault Canada. It trades about 0.1 of its potential returns per unit of risk. Storage Vault Canada is currently generating about 0.02 per unit of risk. If you would invest  246.00  in Citadel Income on December 22, 2024 and sell it today you would earn a total of  27.00  from holding Citadel Income or generate 10.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.72%
Values	Daily Returns

Citadel Income  vs.  Storage Vault Canada

Citadel Income

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citadel Income are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak technical and fundamental indicators, Citadel Income may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Storage Vault Canada

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Storage Vault Canada are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Storage Vault is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Citadel Income and Storage Vault

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

The idea behind Citadel Income and Storage Vault Canada 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.