Correlation Between Citigroup and Big Camera
Can any of the company-specific risk be diversified away by investing in both Citigroup and Big Camera 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 Big Camera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Big Camera, you can compare the effects of market volatilities on Citigroup and Big Camera 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 Big Camera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Big Camera.
Diversification Opportunities for Citigroup and Big Camera
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Big is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Big Camera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Big Camera 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 Big Camera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Big Camera has no effect on the direction of Citigroup i.e., Citigroup and Big Camera go up and down completely randomly.
Pair Corralation between Citigroup and Big Camera
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.66 times more return on investment than Big Camera. However, Citigroup is 1.51 times less risky than Big Camera. It trades about 0.26 of its potential returns per unit of risk. Big Camera is currently generating about -0.23 per unit of risk. If you would invest 6,361 in Citigroup on September 1, 2024 and sell it today you would earn a total of 726.00 from holding Citigroup or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. Big Camera
Performance |
| Timeline |
| Citigroup |
| Big Camera |
Citigroup and Big Camera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Big Camera
The main advantage of trading using opposite Citigroup and Big Camera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Big Camera 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 Big Camera will offset losses from the drop in Big Camera's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Big Camera vs. TRC Construction Public | Big Camera vs. Bangkok Expressway and | Big Camera vs. Lohakit Metal Public | Big Camera vs. Gunkul Engineering Public |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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