Correlation Between Yext and CiT

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

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

Diversification Opportunities for Yext and CiT

0.67

Correlation Coefficient

Yext  CiT

Poor diversification

The 3 months correlation between Yext and CiT is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Yext Inc and CiT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CiT Inc and Yext 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 Yext Inc are associated (or correlated) with CiT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CiT Inc has no effect on the direction of Yext i.e., Yext and CiT go up and down completely randomly.

Pair Corralation between Yext and CiT

Given the investment horizon of 90 days Yext is expected to generate 1.51 times less return on investment than CiT. But when comparing it to its historical volatility, Yext Inc is 1.92 times less risky than CiT. It trades about 0.43 of its potential returns per unit of risk. CiT Inc is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  493.00  in CiT Inc on February 15, 2025 and sell it today you would earn a total of  117.00  from holding CiT Inc or generate 23.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Yext Inc  vs.  CiT Inc

Yext Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Yext Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Yext is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

CiT Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days CiT Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Yext and CiT

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

The idea behind Yext Inc and CiT Inc 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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.