Correlation Between Citigroup and Guangdong Skychem
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By analyzing existing cross correlation between Citigroup and Guangdong Skychem Technology, you can compare the effects of market volatilities on Citigroup and Guangdong Skychem 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 Guangdong Skychem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Guangdong Skychem.
Diversification Opportunities for Citigroup and Guangdong Skychem
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Guangdong is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Guangdong Skychem Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Skychem 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 Guangdong Skychem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Skychem has no effect on the direction of Citigroup i.e., Citigroup and Guangdong Skychem go up and down completely randomly.
Pair Corralation between Citigroup and Guangdong Skychem
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.01 times less return on investment than Guangdong Skychem. But when comparing it to its historical volatility, Citigroup is 2.67 times less risky than Guangdong Skychem. It trades about 0.06 of its potential returns per unit of risk. Guangdong Skychem Technology is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 5,452 in Guangdong Skychem Technology on October 16, 2024 and sell it today you would earn a total of 2,568 from holding Guangdong Skychem Technology or generate 47.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 75.1% |
| Values | Daily Returns |
Citigroup vs. Guangdong Skychem Technology
Performance |
| Timeline |
| Citigroup |
| Guangdong Skychem |
Citigroup and Guangdong Skychem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Guangdong Skychem
The main advantage of trading using opposite Citigroup and Guangdong Skychem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Guangdong Skychem 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 Guangdong Skychem will offset losses from the drop in Guangdong Skychem's long position.| Citigroup vs. Nu Holdings | Citigroup vs. Canadian Imperial Bank | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
| Guangdong Skychem vs. Kunwu Jiuding Investment | Guangdong Skychem vs. Xiandai Investment Co | Guangdong Skychem vs. Hubei Geoway Investment | Guangdong Skychem vs. Henan Shuanghui Investment |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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