Correlation Between Citigroup and Globetronics Tech
Can any of the company-specific risk be diversified away by investing in both Citigroup and Globetronics Tech 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 Globetronics Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Globetronics Tech Bhd, you can compare the effects of market volatilities on Citigroup and Globetronics Tech 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 Globetronics Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Globetronics Tech.
Diversification Opportunities for Citigroup and Globetronics Tech
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Globetronics is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Globetronics Tech Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globetronics Tech Bhd 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 Globetronics Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globetronics Tech Bhd has no effect on the direction of Citigroup i.e., Citigroup and Globetronics Tech go up and down completely randomly.
Pair Corralation between Citigroup and Globetronics Tech
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.5 times more return on investment than Globetronics Tech. However, Citigroup is 1.98 times less risky than Globetronics Tech. It trades about 0.08 of its potential returns per unit of risk. Globetronics Tech Bhd is currently generating about -0.03 per unit of risk. If you would invest 4,091 in Citigroup on September 14, 2024 and sell it today you would earn a total of 3,029 from holding Citigroup or generate 74.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.58% |
| Values | Daily Returns |
Citigroup vs. Globetronics Tech Bhd
Performance |
| Timeline |
| Citigroup |
| Globetronics Tech Bhd |
Citigroup and Globetronics Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Globetronics Tech
The main advantage of trading using opposite Citigroup and Globetronics Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Globetronics Tech 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 Globetronics Tech will offset losses from the drop in Globetronics Tech's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Globetronics Tech vs. Carlsberg Brewery Malaysia | Globetronics Tech vs. Diversified Gateway Solutions | Globetronics Tech vs. Dataprep Holdings Bhd | Globetronics Tech vs. Uchi Technologies Bhd |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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