Correlation Between DATA Communications and Citrine Global

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

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

Diversification Opportunities for DATA Communications and Citrine Global

0.28

Correlation Coefficient

DATA Communications  Citrine Global

Modest diversification

The 3 months correlation between DATA and Citrine is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding DATA Communications Management and Citrine Global Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citrine Global Corp and DATA Communications 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 DATA Communications Management are associated (or correlated) with Citrine Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citrine Global Corp has no effect on the direction of DATA Communications i.e., DATA Communications and Citrine Global go up and down completely randomly.

Pair Corralation between DATA Communications and Citrine Global

Assuming the 90 days horizon DATA Communications Management is expected to generate 0.52 times more return on investment than Citrine Global. However, DATA Communications Management is 1.93 times less risky than Citrine Global. It trades about -0.02 of its potential returns per unit of risk. Citrine Global Corp is currently generating about -0.13 per unit of risk. If you would invest  141.00  in DATA Communications Management on December 28, 2024 and sell it today you would lose (14.00) from holding DATA Communications Management or give up 9.93% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

DATA Communications Management  vs.  Citrine Global Corp

DATA Communications

Risk-Adjusted Performance

Very Weak

Over the last 90 days DATA Communications Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, DATA Communications is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Citrine Global Corp

Risk-Adjusted Performance

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 April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with DATA Communications and Citrine Global

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

The idea behind DATA Communications Management and Citrine Global Corp 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.