Correlation Between Citigroup and Imotrust
Can any of the company-specific risk be diversified away by investing in both Citigroup and Imotrust 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 Imotrust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Imotrust SA, you can compare the effects of market volatilities on Citigroup and Imotrust 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 Imotrust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Imotrust.
Diversification Opportunities for Citigroup and Imotrust
Very weak diversification
The 3 months correlation between Citigroup and Imotrust is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Imotrust SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imotrust SA 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 Imotrust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imotrust SA has no effect on the direction of Citigroup i.e., Citigroup and Imotrust go up and down completely randomly.
Pair Corralation between Citigroup and Imotrust
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.35 times more return on investment than Imotrust. However, Citigroup is 2.82 times less risky than Imotrust. It trades about 0.15 of its potential returns per unit of risk. Imotrust SA is currently generating about -0.01 per unit of risk. If you would invest 6,968 in Citigroup on November 27, 2024 and sell it today you would earn a total of 997.00 from holding Citigroup or generate 14.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 96.55% |
| Values | Daily Returns |
Citigroup vs. Imotrust SA
Performance |
| Timeline |
| Citigroup |
| Imotrust SA |
Citigroup and Imotrust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Imotrust
The main advantage of trading using opposite Citigroup and Imotrust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Imotrust 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 Imotrust will offset losses from the drop in Imotrust's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Imotrust vs. Biofarm Bucure | Imotrust vs. Patria Bank SA | Imotrust vs. Infinity Capital Investments | Imotrust vs. TRANSILVANIA LEASING SI |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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