Correlation Between Getty Copper and Citi Trends

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

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

Diversification Opportunities for Getty Copper and Citi Trends

-0.22

Correlation Coefficient

Getty Copper  Citi Trends

Very good diversification

The 3 months correlation between Getty and Citi is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Getty Copper and Citi Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citi Trends and Getty Copper 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 Getty Copper are associated (or correlated) with Citi Trends. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citi Trends has no effect on the direction of Getty Copper i.e., Getty Copper and Citi Trends go up and down completely randomly.

Pair Corralation between Getty Copper and Citi Trends

Assuming the 90 days horizon Getty Copper is expected to generate 3.41 times more return on investment than Citi Trends. However, Getty Copper is 3.41 times more volatile than Citi Trends. It trades about 0.06 of its potential returns per unit of risk. Citi Trends is currently generating about 0.02 per unit of risk. If you would invest  1.11  in Getty Copper on December 5, 2024 and sell it today you would earn a total of  0.89  from holding Getty Copper or generate 80.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.27%
Values	Daily Returns

Getty Copper  vs.  Citi Trends

Getty Copper

Risk-Adjusted Performance

Very Weak

Over the last 90 days Getty Copper has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Citi Trends

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Getty Copper and Citi Trends

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

The idea behind Getty Copper and Citi Trends 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..