Correlation Between Citigroup and Koge Micro
Can any of the company-specific risk be diversified away by investing in both Citigroup and Koge Micro 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 Koge Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Koge Micro Tech, you can compare the effects of market volatilities on Citigroup and Koge Micro 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 Koge Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Koge Micro.
Diversification Opportunities for Citigroup and Koge Micro
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and Koge is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Koge Micro Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koge Micro Tech 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 Koge Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koge Micro Tech has no effect on the direction of Citigroup i.e., Citigroup and Koge Micro go up and down completely randomly.
Pair Corralation between Citigroup and Koge Micro
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Koge Micro. In addition to that, Citigroup is 1.03 times more volatile than Koge Micro Tech. It trades about -0.08 of its total potential returns per unit of risk. Koge Micro Tech is currently generating about 0.32 per unit of volatility. If you would invest 5,050 in Koge Micro Tech on November 28, 2024 and sell it today you would earn a total of 440.00 from holding Koge Micro Tech or generate 8.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 80.95% |
| Values | Daily Returns |
Citigroup vs. Koge Micro Tech
Performance |
| Timeline |
| Citigroup |
| Koge Micro Tech |
Citigroup and Koge Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Koge Micro
The main advantage of trading using opposite Citigroup and Koge Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Koge Micro 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 Koge Micro will offset losses from the drop in Koge Micro's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Koge Micro vs. Golden Friends | Koge Micro vs. Sunonwealth Electric Machine | Koge Micro vs. Rechi Precision Co | Koge Micro vs. Fittech 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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