Correlation Between Citigroup and Aztec Minerals
Can any of the company-specific risk be diversified away by investing in both Citigroup and Aztec Minerals 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 Aztec Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Aztec Minerals Corp, you can compare the effects of market volatilities on Citigroup and Aztec Minerals 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 Aztec Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Aztec Minerals.
Diversification Opportunities for Citigroup and Aztec Minerals
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and Aztec is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Aztec Minerals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aztec Minerals Corp 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 Aztec Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aztec Minerals Corp has no effect on the direction of Citigroup i.e., Citigroup and Aztec Minerals go up and down completely randomly.
Pair Corralation between Citigroup and Aztec Minerals
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.01 times less return on investment than Aztec Minerals. But when comparing it to its historical volatility, Citigroup is 3.27 times less risky than Aztec Minerals. It trades about 0.06 of its potential returns per unit of risk. Aztec Minerals Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 23.00 in Aztec Minerals Corp on September 3, 2024 and sell it today you would lose (2.00) from holding Aztec Minerals Corp or give up 8.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Aztec Minerals Corp
Performance |
| Timeline |
| Citigroup |
| Aztec Minerals Corp |
Citigroup and Aztec Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Aztec Minerals
The main advantage of trading using opposite Citigroup and Aztec Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Aztec Minerals 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 Aztec Minerals will offset losses from the drop in Aztec Minerals' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Aztec Minerals vs. Lion One Metals | Aztec Minerals vs. Computer Modelling Group | Aztec Minerals vs. Converge Technology Solutions | Aztec Minerals vs. Andlauer Healthcare Gr |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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