Correlation Between Citigroup and AMAG Austria
Can any of the company-specific risk be diversified away by investing in both Citigroup and AMAG Austria 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 AMAG Austria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and AMAG Austria Metall, you can compare the effects of market volatilities on Citigroup and AMAG Austria 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 AMAG Austria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and AMAG Austria.
Diversification Opportunities for Citigroup and AMAG Austria
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and AMAG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and AMAG Austria Metall in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMAG Austria Metall 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 AMAG Austria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMAG Austria Metall has no effect on the direction of Citigroup i.e., Citigroup and AMAG Austria go up and down completely randomly.
Pair Corralation between Citigroup and AMAG Austria
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.12 times more return on investment than AMAG Austria. However, Citigroup is 1.12 times more volatile than AMAG Austria Metall. It trades about 0.06 of its potential returns per unit of risk. AMAG Austria Metall is currently generating about -0.03 per unit of risk. If you would invest 4,790 in Citigroup on October 14, 2024 and sell it today you would earn a total of 2,350 from holding Citigroup or generate 49.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.8% |
| Values | Daily Returns |
Citigroup vs. AMAG Austria Metall
Performance |
| Timeline |
| Citigroup |
| AMAG Austria Metall |
Citigroup and AMAG Austria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and AMAG Austria
The main advantage of trading using opposite Citigroup and AMAG Austria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, AMAG Austria 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 AMAG Austria will offset losses from the drop in AMAG Austria's long position.| Citigroup vs. Nu Holdings | Citigroup vs. Canadian Imperial Bank | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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