Correlation Between Energy Income and Citadel Income

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

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

Diversification Opportunities for Energy Income and Citadel Income

0.47

Correlation Coefficient

Energy Income  Citadel Income

Very weak diversification

The 3 months correlation between Energy and Citadel is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Energy Income and Citadel Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citadel Income and Energy 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 Energy Income are associated (or correlated) with Citadel Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citadel Income has no effect on the direction of Energy Income i.e., Energy Income and Citadel Income go up and down completely randomly.

Pair Corralation between Energy Income and Citadel Income

Assuming the 90 days trading horizon Energy Income is expected to generate 1.23 times more return on investment than Citadel Income. However, Energy Income is 1.23 times more volatile than Citadel Income. It trades about 0.03 of its potential returns per unit of risk. Citadel Income is currently generating about 0.01 per unit of risk. If you would invest  135.00  in Energy Income on April 20, 2025 and sell it today you would earn a total of  37.00  from holding Energy Income or generate 27.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	86.67%
Values	Daily Returns

Energy Income  vs.  Citadel Income

Energy Income

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Energy Income are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak forward indicators, Energy Income may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Citadel Income

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citadel Income are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. 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.

Pair Trading with Energy Income and Citadel Income

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

The idea behind Energy Income and Citadel Income 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.