Correlation Between Citigroup and ENTEQ TECHNOLOGIES
Can any of the company-specific risk be diversified away by investing in both Citigroup and ENTEQ TECHNOLOGIES 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 ENTEQ TECHNOLOGIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and ENTEQ TECHNOLOGIES LS 01, you can compare the effects of market volatilities on Citigroup and ENTEQ TECHNOLOGIES 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 ENTEQ TECHNOLOGIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and ENTEQ TECHNOLOGIES.
Diversification Opportunities for Citigroup and ENTEQ TECHNOLOGIES
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and ENTEQ is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and ENTEQ TECHNOLOGIES LS 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENTEQ TECHNOLOGIES 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 ENTEQ TECHNOLOGIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENTEQ TECHNOLOGIES has no effect on the direction of Citigroup i.e., Citigroup and ENTEQ TECHNOLOGIES go up and down completely randomly.
Pair Corralation between Citigroup and ENTEQ TECHNOLOGIES
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.12 times more return on investment than ENTEQ TECHNOLOGIES. However, Citigroup is 8.69 times less risky than ENTEQ TECHNOLOGIES. It trades about 0.27 of its potential returns per unit of risk. ENTEQ TECHNOLOGIES LS 01 is currently generating about -0.15 per unit of risk. If you would invest 6,889 in Citigroup on September 14, 2024 and sell it today you would earn a total of 307.00 from holding Citigroup or generate 4.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. ENTEQ TECHNOLOGIES LS 01
Performance |
| Timeline |
| Citigroup |
| ENTEQ TECHNOLOGIES |
Citigroup and ENTEQ TECHNOLOGIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and ENTEQ TECHNOLOGIES
The main advantage of trading using opposite Citigroup and ENTEQ TECHNOLOGIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, ENTEQ TECHNOLOGIES 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 ENTEQ TECHNOLOGIES will offset losses from the drop in ENTEQ TECHNOLOGIES's long position.| Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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