Correlation Between Citigroup and Emerging Display
Can any of the company-specific risk be diversified away by investing in both Citigroup and Emerging Display 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 Emerging Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Emerging Display Technologies, you can compare the effects of market volatilities on Citigroup and Emerging Display 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 Emerging Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Emerging Display.
Diversification Opportunities for Citigroup and Emerging Display
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and Emerging is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Emerging Display Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Display Tec 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 Emerging Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Display Tec has no effect on the direction of Citigroup i.e., Citigroup and Emerging Display go up and down completely randomly.
Pair Corralation between Citigroup and Emerging Display
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.78 times more return on investment than Emerging Display. However, Citigroup is 1.28 times less risky than Emerging Display. It trades about 0.45 of its potential returns per unit of risk. Emerging Display Technologies is currently generating about 0.11 per unit of risk. If you would invest 6,842 in Citigroup on October 20, 2024 and sell it today you would earn a total of 1,157 from holding Citigroup or generate 16.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Citigroup vs. Emerging Display Technologies
Performance |
| Timeline |
| Citigroup |
| Emerging Display Tec |
Citigroup and Emerging Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Emerging Display
The main advantage of trading using opposite Citigroup and Emerging Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Emerging Display 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 Emerging Display will offset losses from the drop in Emerging Display's long position.| Citigroup vs. Bank of Montreal | Citigroup vs. Canadian Imperial Bank | Citigroup vs. Bank of Nova | Citigroup vs. JPMorgan Chase Co |
| Emerging Display vs. ASRock Inc | Emerging Display vs. FIC Global | Emerging Display vs. In Win Development | Emerging Display vs. Getac Technology Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |