Correlation Between Citigroup and ID Logistics
Can any of the company-specific risk be diversified away by investing in both Citigroup and ID Logistics 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 ID Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and ID Logistics SAS, you can compare the effects of market volatilities on Citigroup and ID Logistics 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 ID Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and ID Logistics.
Diversification Opportunities for Citigroup and ID Logistics
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and 1ID is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and ID Logistics SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ID Logistics SAS 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 ID Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ID Logistics SAS has no effect on the direction of Citigroup i.e., Citigroup and ID Logistics go up and down completely randomly.
Pair Corralation between Citigroup and ID Logistics
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.89 times more return on investment than ID Logistics. However, Citigroup is 1.12 times less risky than ID Logistics. It trades about 0.02 of its potential returns per unit of risk. ID Logistics SAS is currently generating about 0.01 per unit of risk. If you would invest 6,895 in Citigroup on September 22, 2024 and sell it today you would earn a total of 24.00 from holding Citigroup or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Citigroup vs. ID Logistics SAS
Performance |
| Timeline |
| Citigroup |
| ID Logistics SAS |
Citigroup and ID Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and ID Logistics
The main advantage of trading using opposite Citigroup and ID Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, ID Logistics 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 ID Logistics will offset losses from the drop in ID Logistics' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| ID Logistics vs. Ares Management Corp | ID Logistics vs. Merit Medical Systems | ID Logistics vs. CEOTRONICS | ID Logistics vs. SCANDMEDICAL SOLDK 040 |
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 Stocks Directory module to find actively traded stocks across global markets.
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