Correlation Between Citigroup and Baloise Holding
Can any of the company-specific risk be diversified away by investing in both Citigroup and Baloise Holding 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 Baloise Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Baloise Holding AG, you can compare the effects of market volatilities on Citigroup and Baloise Holding 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 Baloise Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Baloise Holding.
Diversification Opportunities for Citigroup and Baloise Holding
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Baloise is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Baloise Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baloise Holding AG 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 Baloise Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baloise Holding AG has no effect on the direction of Citigroup i.e., Citigroup and Baloise Holding go up and down completely randomly.
Pair Corralation between Citigroup and Baloise Holding
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.61 times more return on investment than Baloise Holding. However, Citigroup is 1.61 times more volatile than Baloise Holding AG. It trades about 0.08 of its potential returns per unit of risk. Baloise Holding AG is currently generating about 0.07 per unit of risk. If you would invest 4,525 in Citigroup on August 31, 2024 and sell it today you would earn a total of 2,562 from holding Citigroup or generate 56.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Citigroup vs. Baloise Holding AG
Performance |
| Timeline |
| Citigroup |
| Baloise Holding AG |
Citigroup and Baloise Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Baloise Holding
The main advantage of trading using opposite Citigroup and Baloise Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Baloise Holding 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 Baloise Holding will offset losses from the drop in Baloise Holding's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Baloise Holding vs. Swiss Life Holding | Baloise Holding vs. Helvetia Holding AG | Baloise Holding vs. Swisscom AG | Baloise Holding vs. Zurich Insurance Group |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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