Correlation Between Citigroup and Auxly Cannabis
Can any of the company-specific risk be diversified away by investing in both Citigroup and Auxly Cannabis 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 Auxly Cannabis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Auxly Cannabis Group, you can compare the effects of market volatilities on Citigroup and Auxly Cannabis 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 Auxly Cannabis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Auxly Cannabis.
Diversification Opportunities for Citigroup and Auxly Cannabis
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Citigroup and Auxly is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Auxly Cannabis Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auxly Cannabis Group 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 Auxly Cannabis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auxly Cannabis Group has no effect on the direction of Citigroup i.e., Citigroup and Auxly Cannabis go up and down completely randomly.
Pair Corralation between Citigroup and Auxly Cannabis
Taking into account the 90-day investment horizon Citigroup is expected to generate 19.39 times less return on investment than Auxly Cannabis. But when comparing it to its historical volatility, Citigroup is 15.58 times less risky than Auxly Cannabis. It trades about 0.09 of its potential returns per unit of risk. Auxly Cannabis Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1.88 in Auxly Cannabis Group on September 13, 2024 and sell it today you would lose (0.82) from holding Auxly Cannabis Group or give up 43.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.66% |
| Values | Daily Returns |
Citigroup vs. Auxly Cannabis Group
Performance |
| Timeline |
| Citigroup |
| Auxly Cannabis Group |
Citigroup and Auxly Cannabis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Auxly Cannabis
The main advantage of trading using opposite Citigroup and Auxly Cannabis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Auxly Cannabis 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 Auxly Cannabis will offset losses from the drop in Auxly Cannabis' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Auxly Cannabis vs. PLAYMATES TOYS | Auxly Cannabis vs. FUTURE GAMING GRP | Auxly Cannabis vs. TITANIUM TRANSPORTGROUP | Auxly Cannabis vs. Fukuyama Transporting 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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