Correlation Between Citigroup and Prince Housing
Can any of the company-specific risk be diversified away by investing in both Citigroup and Prince Housing 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 Prince Housing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Prince Housing Development, you can compare the effects of market volatilities on Citigroup and Prince Housing 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 Prince Housing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Prince Housing.
Diversification Opportunities for Citigroup and Prince Housing
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Prince is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Prince Housing Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prince Housing Devel 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 Prince Housing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prince Housing Devel has no effect on the direction of Citigroup i.e., Citigroup and Prince Housing go up and down completely randomly.
Pair Corralation between Citigroup and Prince Housing
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.0 times more return on investment than Prince Housing. However, Citigroup is 1.0 times less risky than Prince Housing. It trades about 0.1 of its potential returns per unit of risk. Prince Housing Development is currently generating about 0.0 per unit of risk. If you would invest 4,357 in Citigroup on August 26, 2024 and sell it today you would earn a total of 2,627 from holding Citigroup or generate 60.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.6% |
| Values | Daily Returns |
Citigroup vs. Prince Housing Development
Performance |
| Timeline |
| Citigroup |
| Prince Housing Devel |
Citigroup and Prince Housing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Prince Housing
The main advantage of trading using opposite Citigroup and Prince Housing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Prince Housing 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 Prince Housing will offset losses from the drop in Prince Housing's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Prince Housing vs. Compal Electronics | Prince Housing vs. China Metal Products | Prince Housing vs. Ligitek Electronics Co | Prince Housing vs. Oceanic Beverages 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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