Correlation Between Citigroup and Entreprendre
Can any of the company-specific risk be diversified away by investing in both Citigroup and Entreprendre 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 Entreprendre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Entreprendre, you can compare the effects of market volatilities on Citigroup and Entreprendre 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 Entreprendre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Entreprendre.
Diversification Opportunities for Citigroup and Entreprendre
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Entreprendre is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Entreprendre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entreprendre 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 Entreprendre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entreprendre has no effect on the direction of Citigroup i.e., Citigroup and Entreprendre go up and down completely randomly.
Pair Corralation between Citigroup and Entreprendre
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.3 times less return on investment than Entreprendre. But when comparing it to its historical volatility, Citigroup is 1.1 times less risky than Entreprendre. It trades about 0.07 of its potential returns per unit of risk. Entreprendre is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 300.00 in Entreprendre on September 1, 2024 and sell it today you would earn a total of 144.00 from holding Entreprendre or generate 48.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.92% |
| Values | Daily Returns |
Citigroup vs. Entreprendre
Performance |
| Timeline |
| Citigroup |
| Entreprendre |
Citigroup and Entreprendre Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Entreprendre
The main advantage of trading using opposite Citigroup and Entreprendre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Entreprendre 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 Entreprendre will offset losses from the drop in Entreprendre's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Entreprendre vs. Lexibook Linguistic Electronic | Entreprendre vs. Kumulus Vape SA | Entreprendre vs. Manitou BF SA | Entreprendre vs. Ossiam Minimum Variance |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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