Correlation Between Citigroup and China Southern
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By analyzing existing cross correlation between Citigroup and China Southern SSE, you can compare the effects of market volatilities on Citigroup and China Southern 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 China Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and China Southern.
Diversification Opportunities for Citigroup and China Southern
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and China is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and China Southern SSE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Southern SSE 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 China Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Southern SSE has no effect on the direction of Citigroup i.e., Citigroup and China Southern go up and down completely randomly.
Pair Corralation between Citigroup and China Southern
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.01 times more return on investment than China Southern. However, Citigroup is 1.01 times more volatile than China Southern SSE. It trades about 0.11 of its potential returns per unit of risk. China Southern SSE is currently generating about 0.04 per unit of risk. If you would invest 4,788 in Citigroup on September 12, 2024 and sell it today you would earn a total of 2,408 from holding Citigroup or generate 50.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.97% |
| Values | Daily Returns |
Citigroup vs. China Southern SSE
Performance |
| Timeline |
| Citigroup |
| China Southern SSE |
Citigroup and China Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and China Southern
The main advantage of trading using opposite Citigroup and China Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, China Southern 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 China Southern will offset losses from the drop in China Southern's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| China Southern vs. Shenzhen MTC Co | China Southern vs. Ming Yang Smart | China Southern vs. Changzhou Almaden Co | China Southern vs. 159681 |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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