Correlation Between Citigroup and Ningbo Thermal
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By analyzing existing cross correlation between Citigroup and Ningbo Thermal Power, you can compare the effects of market volatilities on Citigroup and Ningbo Thermal 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 Ningbo Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Ningbo Thermal.
Diversification Opportunities for Citigroup and Ningbo Thermal
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Ningbo is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Ningbo Thermal Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Thermal Power 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 Ningbo Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Thermal Power has no effect on the direction of Citigroup i.e., Citigroup and Ningbo Thermal go up and down completely randomly.
Pair Corralation between Citigroup and Ningbo Thermal
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.74 times more return on investment than Ningbo Thermal. However, Citigroup is 1.34 times less risky than Ningbo Thermal. It trades about 0.11 of its potential returns per unit of risk. Ningbo Thermal Power is currently generating about 0.04 per unit of risk. If you would invest 5,308 in Citigroup on November 3, 2024 and sell it today you would earn a total of 2,835 from holding Citigroup or generate 53.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.76% |
| Values | Daily Returns |
Citigroup vs. Ningbo Thermal Power
Performance |
| Timeline |
| Citigroup |
| Ningbo Thermal Power |
Citigroup and Ningbo Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Ningbo Thermal
The main advantage of trading using opposite Citigroup and Ningbo Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Ningbo Thermal 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 Ningbo Thermal will offset losses from the drop in Ningbo Thermal's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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