Correlation Between Citigroup and Airtac International
Can any of the company-specific risk be diversified away by investing in both Citigroup and Airtac International 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 Airtac International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Airtac International Group, you can compare the effects of market volatilities on Citigroup and Airtac International 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 Airtac International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Airtac International.
Diversification Opportunities for Citigroup and Airtac International
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Citigroup and Airtac is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Airtac International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airtac International 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 Airtac International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airtac International has no effect on the direction of Citigroup i.e., Citigroup and Airtac International go up and down completely randomly.
Pair Corralation between Citigroup and Airtac International
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.67 times more return on investment than Airtac International. However, Citigroup is 1.49 times less risky than Airtac International. It trades about 0.08 of its potential returns per unit of risk. Airtac International Group is currently generating about -0.02 per unit of risk. If you would invest 4,558 in Citigroup on September 2, 2024 and sell it today you would earn a total of 2,529 from holding Citigroup or generate 55.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Citigroup vs. Airtac International Group
Performance |
| Timeline |
| Citigroup |
| Airtac International |
Citigroup and Airtac International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Airtac International
The main advantage of trading using opposite Citigroup and Airtac International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Airtac International 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 Airtac International will offset losses from the drop in Airtac International's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Airtac International vs. Hiwin Technologies Corp | Airtac International vs. Advantech Co | Airtac International vs. Delta Electronics | Airtac International vs. Eclat Textile 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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