Correlation Between Citigroup and Korea Information
Can any of the company-specific risk be diversified away by investing in both Citigroup and Korea Information 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 Citigroup and Korea Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Korea Information Communications, you can compare the effects of market volatilities on Citigroup and Korea Information 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 Korea Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Korea Information.
Diversification Opportunities for Citigroup and Korea Information
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Korea is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Korea Information Communicatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Information 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 Korea Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Information has no effect on the direction of Citigroup i.e., Citigroup and Korea Information go up and down completely randomly.
Pair Corralation between Citigroup and Korea Information
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.26 times more return on investment than Korea Information. However, Citigroup is 2.26 times more volatile than Korea Information Communications. It trades about 0.23 of its potential returns per unit of risk. Korea Information Communications is currently generating about -0.02 per unit of risk. If you would invest 6,255 in Citigroup on August 24, 2024 and sell it today you would earn a total of 729.00 from holding Citigroup or generate 11.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Korea Information Communicatio
Performance |
| Timeline |
| Citigroup |
| Korea Information |
Citigroup and Korea Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Korea Information
The main advantage of trading using opposite Citigroup and Korea Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Korea Information 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 Korea Information will offset losses from the drop in Korea Information's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Korea Information vs. Korea Real Estate | Korea Information vs. Korea Ratings Co | Korea Information vs. IQuest Co | Korea Information vs. Wonbang Tech 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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