Correlation Between Citigroup and Wenzhou Hongfeng
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By analyzing existing cross correlation between Citigroup and Wenzhou Hongfeng Electrical, you can compare the effects of market volatilities on Citigroup and Wenzhou Hongfeng 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 Wenzhou Hongfeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Wenzhou Hongfeng.
Diversification Opportunities for Citigroup and Wenzhou Hongfeng
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Wenzhou is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Wenzhou Hongfeng Electrical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wenzhou Hongfeng Ele 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 Wenzhou Hongfeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wenzhou Hongfeng Ele has no effect on the direction of Citigroup i.e., Citigroup and Wenzhou Hongfeng go up and down completely randomly.
Pair Corralation between Citigroup and Wenzhou Hongfeng
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.28 times more return on investment than Wenzhou Hongfeng. However, Citigroup is 3.59 times less risky than Wenzhou Hongfeng. It trades about 0.18 of its potential returns per unit of risk. Wenzhou Hongfeng Electrical is currently generating about -0.01 per unit of risk. If you would invest 6,980 in Citigroup on September 12, 2024 and sell it today you would earn a total of 224.00 from holding Citigroup or generate 3.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citigroup vs. Wenzhou Hongfeng Electrical
Performance |
| Timeline |
| Citigroup |
| Wenzhou Hongfeng Ele |
Citigroup and Wenzhou Hongfeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Wenzhou Hongfeng
The main advantage of trading using opposite Citigroup and Wenzhou Hongfeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Wenzhou Hongfeng 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 Wenzhou Hongfeng will offset losses from the drop in Wenzhou Hongfeng's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Wenzhou Hongfeng vs. YLZ Information Tech | Wenzhou Hongfeng vs. Xiamen Goldenhome Co | Wenzhou Hongfeng vs. ButOne Information Corp | Wenzhou Hongfeng vs. Nanxing Furniture Machinery |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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