Correlation Between Citigroup and Brookfield Global
Can any of the company-specific risk be diversified away by investing in both Citigroup and Brookfield Global 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 Brookfield Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Brookfield Global Infrastructure, you can compare the effects of market volatilities on Citigroup and Brookfield Global 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 Brookfield Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Brookfield Global.
Diversification Opportunities for Citigroup and Brookfield Global
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Citigroup and Brookfield is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Brookfield Global Infrastructu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Global 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 Brookfield Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Global has no effect on the direction of Citigroup i.e., Citigroup and Brookfield Global go up and down completely randomly.
Pair Corralation between Citigroup and Brookfield Global
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.01 times more return on investment than Brookfield Global. However, Citigroup is 1.01 times more volatile than Brookfield Global Infrastructure. It trades about 0.22 of its potential returns per unit of risk. Brookfield Global Infrastructure is currently generating about -0.3 per unit of risk. If you would invest 6,980 in Citigroup on September 12, 2024 and sell it today you would earn a total of 270.00 from holding Citigroup or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. Brookfield Global Infrastructu
Performance |
| Timeline |
| Citigroup |
| Brookfield Global |
Citigroup and Brookfield Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Brookfield Global
The main advantage of trading using opposite Citigroup and Brookfield Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Brookfield Global 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 Brookfield Global will offset losses from the drop in Brookfield Global's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Brookfield Global vs. Income Financial Trust | Brookfield Global vs. Dividend Select 15 | Brookfield Global vs. Global Dividend Growth | Brookfield Global vs. Brompton Split Banc |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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