Correlation Between Citigroup and WuXi Xinje
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By analyzing existing cross correlation between Citigroup and WuXi Xinje Electric, you can compare the effects of market volatilities on Citigroup and WuXi Xinje 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 WuXi Xinje. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and WuXi Xinje.
Diversification Opportunities for Citigroup and WuXi Xinje
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and WuXi is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and WuXi Xinje Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WuXi Xinje Electric 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 WuXi Xinje. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WuXi Xinje Electric has no effect on the direction of Citigroup i.e., Citigroup and WuXi Xinje go up and down completely randomly.
Pair Corralation between Citigroup and WuXi Xinje
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.62 times more return on investment than WuXi Xinje. However, Citigroup is 1.61 times less risky than WuXi Xinje. It trades about 0.06 of its potential returns per unit of risk. WuXi Xinje Electric is currently generating about 0.0 per unit of risk. If you would invest 4,739 in Citigroup on October 15, 2024 and sell it today you would earn a total of 2,401 from holding Citigroup or generate 50.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.57% |
| Values | Daily Returns |
Citigroup vs. WuXi Xinje Electric
Performance |
| Timeline |
| Citigroup |
| WuXi Xinje Electric |
Citigroup and WuXi Xinje Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and WuXi Xinje
The main advantage of trading using opposite Citigroup and WuXi Xinje positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, WuXi Xinje 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 WuXi Xinje will offset losses from the drop in WuXi Xinje's long position.| Citigroup vs. Nu Holdings | Citigroup vs. Canadian Imperial Bank | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
| WuXi Xinje vs. Hunan Mendale Hometextile | WuXi Xinje vs. Jinlong Machinery Electronic | WuXi Xinje vs. Qumei Furniture Group | WuXi Xinje vs. Aurora Optoelectronics 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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