Correlation Between Citigroup and Invesco Comstock
Can any of the company-specific risk be diversified away by investing in both Citigroup and Invesco Comstock 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 Invesco Comstock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Invesco Stock Fund, you can compare the effects of market volatilities on Citigroup and Invesco Comstock 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 Invesco Comstock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Invesco Comstock.
Diversification Opportunities for Citigroup and Invesco Comstock
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citigroup and Invesco is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Invesco Stock Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Comstock 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 Invesco Comstock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Comstock has no effect on the direction of Citigroup i.e., Citigroup and Invesco Comstock go up and down completely randomly.
Pair Corralation between Citigroup and Invesco Comstock
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.24 times more return on investment than Invesco Comstock. However, Citigroup is 2.24 times more volatile than Invesco Stock Fund. It trades about 0.21 of its potential returns per unit of risk. Invesco Stock Fund is currently generating about 0.25 per unit of risk. If you would invest 6,360 in Citigroup on August 29, 2024 and sell it today you would earn a total of 615.00 from holding Citigroup or generate 9.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citigroup vs. Invesco Stock Fund
Performance |
| Timeline |
| Citigroup |
| Invesco Comstock |
Citigroup and Invesco Comstock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Invesco Comstock
The main advantage of trading using opposite Citigroup and Invesco Comstock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Invesco Comstock 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 Invesco Comstock will offset losses from the drop in Invesco Comstock'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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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