Correlation Between Citadel Income and First National

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

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

Diversification Opportunities for Citadel Income and First National

0.38

Correlation Coefficient

Citadel Income  First National

Weak diversification

The 3 months correlation between Citadel and First is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Citadel Income and First National Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First National Financial 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 First National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First National Financial has no effect on the direction of Citadel Income i.e., Citadel Income and First National go up and down completely randomly.

Pair Corralation between Citadel Income and First National

Assuming the 90 days trading horizon Citadel Income is expected to generate 1.78 times more return on investment than First National. However, Citadel Income is 1.78 times more volatile than First National Financial. It trades about 0.12 of its potential returns per unit of risk. First National Financial is currently generating about 0.1 per unit of risk. If you would invest  246.00  in Citadel Income on April 28, 2025 and sell it today you would earn a total of  33.00  from holding Citadel Income or generate 13.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	89.06%
Values	Daily Returns

Citadel Income  vs.  First National Financial

Citadel Income

Risk-Adjusted Performance

OK

Over the last 90 days Citadel Income has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat weak technical and fundamental indicators, Citadel Income sustained solid returns over the last few months and may actually be approaching a breakup point.

First National Financial

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in First National Financial are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, First National may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Citadel Income and First National

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

The idea behind Citadel Income and First National Financial 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.