Correlation Between Citigroup and Emera Maine
Can any of the company-specific risk be diversified away by investing in both Citigroup and Emera Maine 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 Emera Maine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Emera Maine PFD, you can compare the effects of market volatilities on Citigroup and Emera Maine 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 Emera Maine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Emera Maine.
Diversification Opportunities for Citigroup and Emera Maine
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Emera is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Emera Maine PFD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emera Maine PFD 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 Emera Maine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emera Maine PFD has no effect on the direction of Citigroup i.e., Citigroup and Emera Maine go up and down completely randomly.
Pair Corralation between Citigroup and Emera Maine
If you would invest 6,092 in Citigroup on September 2, 2024 and sell it today you would earn a total of 995.00 from holding Citigroup or generate 16.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 1.56% |
| Values | Daily Returns |
Citigroup vs. Emera Maine PFD
Performance |
| Timeline |
| Citigroup |
| Emera Maine PFD |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Emera Maine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Emera Maine
The main advantage of trading using opposite Citigroup and Emera Maine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Emera Maine 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 Emera Maine will offset losses from the drop in Emera Maine's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Emera Maine vs. Assurant | Emera Maine vs. QBE Insurance Group | Emera Maine vs. Direct Line Insurance | Emera Maine vs. The Hanover Insurance |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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