Correlation Between Citadel Income and TNP Old

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

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

Diversification Opportunities for Citadel Income and TNP Old

-0.31

Correlation Coefficient

Citadel Income  TNP Old

Very good diversification

The 3 months correlation between Citadel and TNP is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Citadel Income and TNP Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TNP Old 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 TNP Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TNP Old has no effect on the direction of Citadel Income i.e., Citadel Income and TNP Old go up and down completely randomly.

Pair Corralation between Citadel Income and TNP Old

If you would invest  234.00  in Citadel Income on October 22, 2024 and sell it today you would earn a total of  22.00  from holding Citadel Income or generate 9.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.82%
Values	Daily Returns

Citadel Income  vs.  TNP Old

Citadel Income

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Citadel Income has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong technical and fundamental indicators, Citadel Income is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

TNP Old

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TNP Old has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, TNP Old is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Citadel Income and TNP Old

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

The idea behind Citadel Income and TNP Old 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.