Correlation Between Citigroup and Ab Select
Can any of the company-specific risk be diversified away by investing in both Citigroup and Ab Select 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 Ab Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Ab Select Longshort, you can compare the effects of market volatilities on Citigroup and Ab Select 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 Ab Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Ab Select.
Diversification Opportunities for Citigroup and Ab Select
Very weak diversification
The 3 months correlation between Citigroup and ASRLX is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Ab Select Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Select Longshort 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 Ab Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Select Longshort has no effect on the direction of Citigroup i.e., Citigroup and Ab Select go up and down completely randomly.
Pair Corralation between Citigroup and Ab Select
Taking into account the 90-day investment horizon Citigroup is expected to generate 3.96 times more return on investment than Ab Select. However, Citigroup is 3.96 times more volatile than Ab Select Longshort. It trades about 0.12 of its potential returns per unit of risk. Ab Select Longshort is currently generating about 0.16 per unit of risk. If you would invest 3,936 in Citigroup on August 29, 2024 and sell it today you would earn a total of 3,080 from holding Citigroup or generate 78.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 61.22% |
| Values | Daily Returns |
Citigroup vs. Ab Select Longshort
Performance |
| Timeline |
| Citigroup |
| Ab Select Longshort |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Ab Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Ab Select
The main advantage of trading using opposite Citigroup and Ab Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Ab Select 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 Ab Select will offset losses from the drop in Ab Select's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Ab Select vs. Delaware Limited Term Diversified | Ab Select vs. Pimco Diversified Income | Ab Select vs. American Funds Conservative | Ab Select vs. Adams Diversified Equity |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |