Correlation Between Chia and Citycon Oyj

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

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

Diversification Opportunities for Chia and Citycon Oyj

-0.23

Correlation Coefficient

Chia  Citycon Oyj

Very good diversification

The 3 months correlation between Chia and Citycon is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Chia and Citycon Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citycon Oyj and Chia 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 Chia are associated (or correlated) with Citycon Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citycon Oyj has no effect on the direction of Chia i.e., Chia and Citycon Oyj go up and down completely randomly.

Pair Corralation between Chia and Citycon Oyj

Assuming the 90 days trading horizon Chia is expected to under-perform the Citycon Oyj. In addition to that, Chia is 3.04 times more volatile than Citycon Oyj. It trades about -0.08 of its total potential returns per unit of risk. Citycon Oyj is currently generating about 0.04 per unit of volatility. If you would invest  313.00  in Citycon Oyj on December 20, 2024 and sell it today you would earn a total of  10.00  from holding Citycon Oyj or generate 3.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.65%
Values	Daily Returns

Chia  vs.  Citycon Oyj

Chia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's technical indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Chia shareholders.

Citycon Oyj

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Citycon Oyj are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Citycon Oyj is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Chia and Citycon Oyj

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

The idea behind Chia and Citycon Oyj 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.