Correlation Between Citigroup and Railway Signal
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By analyzing existing cross correlation between Citigroup and Railway Signal Communication, you can compare the effects of market volatilities on Citigroup and Railway Signal 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 Railway Signal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Railway Signal.
Diversification Opportunities for Citigroup and Railway Signal
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Railway is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Railway Signal Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Railway Signal Commu 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 Railway Signal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Railway Signal Commu has no effect on the direction of Citigroup i.e., Citigroup and Railway Signal go up and down completely randomly.
Pair Corralation between Citigroup and Railway Signal
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.14 times less return on investment than Railway Signal. But when comparing it to its historical volatility, Citigroup is 1.55 times less risky than Railway Signal. It trades about 0.06 of its potential returns per unit of risk. Railway Signal Communication is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 547.00 in Railway Signal Communication on September 3, 2024 and sell it today you would earn a total of 89.00 from holding Railway Signal Communication or generate 16.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.39% |
| Values | Daily Returns |
Citigroup vs. Railway Signal Communication
Performance |
| Timeline |
| Citigroup |
| Railway Signal Commu |
Citigroup and Railway Signal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Railway Signal
The main advantage of trading using opposite Citigroup and Railway Signal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Railway Signal 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 Railway Signal will offset losses from the drop in Railway Signal's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Railway Signal vs. Renxin New Material | Railway Signal vs. CICC Fund Management | Railway Signal vs. Super Dragon Engineering Plastics | Railway Signal vs. Sunny Loan Top |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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