Correlation Between Citigroup and Hangzhou Weiguang
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By analyzing existing cross correlation between Citigroup and Hangzhou Weiguang Electronic, you can compare the effects of market volatilities on Citigroup and Hangzhou Weiguang 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 Citigroup with a short position of Hangzhou Weiguang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Hangzhou Weiguang.
Diversification Opportunities for Citigroup and Hangzhou Weiguang
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Hangzhou is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Hangzhou Weiguang Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Weiguang and Citigroup 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 Citigroup are associated (or correlated) with Hangzhou Weiguang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Weiguang has no effect on the direction of Citigroup i.e., Citigroup and Hangzhou Weiguang go up and down completely randomly.
Pair Corralation between Citigroup and Hangzhou Weiguang
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.15 times less return on investment than Hangzhou Weiguang. But when comparing it to its historical volatility, Citigroup is 1.3 times less risky than Hangzhou Weiguang. It trades about 0.26 of its potential returns per unit of risk. Hangzhou Weiguang Electronic is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 2,133 in Hangzhou Weiguang Electronic on September 1, 2024 and sell it today you would earn a total of 303.00 from holding Hangzhou Weiguang Electronic or generate 14.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 91.3% |
| Values | Daily Returns |
Citigroup vs. Hangzhou Weiguang Electronic
Performance |
| Timeline |
| Citigroup |
| Hangzhou Weiguang |
Citigroup and Hangzhou Weiguang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Hangzhou Weiguang
The main advantage of trading using opposite Citigroup and Hangzhou Weiguang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Hangzhou Weiguang 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 Hangzhou Weiguang will offset losses from the drop in Hangzhou Weiguang's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Hangzhou Weiguang vs. China Life Insurance | Hangzhou Weiguang vs. Cinda Securities Co | Hangzhou Weiguang vs. Piotech Inc A | Hangzhou Weiguang vs. Dongxing Sec Co |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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