Correlation Between Citigroup and Arwana Citramulia
Can any of the company-specific risk be diversified away by investing in both Citigroup and Arwana Citramulia 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 Arwana Citramulia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Arwana Citramulia Tbk, you can compare the effects of market volatilities on Citigroup and Arwana Citramulia 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 Arwana Citramulia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Arwana Citramulia.
Diversification Opportunities for Citigroup and Arwana Citramulia
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Arwana is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Arwana Citramulia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arwana Citramulia Tbk 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 Arwana Citramulia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arwana Citramulia Tbk has no effect on the direction of Citigroup i.e., Citigroup and Arwana Citramulia go up and down completely randomly.
Pair Corralation between Citigroup and Arwana Citramulia
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.78 times more return on investment than Arwana Citramulia. However, Citigroup is 2.78 times more volatile than Arwana Citramulia Tbk. It trades about 0.24 of its potential returns per unit of risk. Arwana Citramulia Tbk is currently generating about -0.26 per unit of risk. If you would invest 6,245 in Citigroup on August 25, 2024 and sell it today you would earn a total of 739.00 from holding Citigroup or generate 11.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Arwana Citramulia Tbk
Performance |
| Timeline |
| Citigroup |
| Arwana Citramulia Tbk |
Citigroup and Arwana Citramulia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Arwana Citramulia
The main advantage of trading using opposite Citigroup and Arwana Citramulia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Arwana Citramulia 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 Arwana Citramulia will offset losses from the drop in Arwana Citramulia's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Arwana Citramulia vs. Asahimas Flat Glass | Arwana Citramulia vs. Astra Graphia Tbk | Arwana Citramulia vs. Ekadharma International Tbk | Arwana Citramulia vs. Akasha Wira International |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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