Correlation Between Citigroup and Bang Olufsen
Can any of the company-specific risk be diversified away by investing in both Citigroup and Bang Olufsen 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 Bang Olufsen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Bang Olufsen, you can compare the effects of market volatilities on Citigroup and Bang Olufsen 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 Bang Olufsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Bang Olufsen.
Diversification Opportunities for Citigroup and Bang Olufsen
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and Bang is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Bang Olufsen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bang Olufsen 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 Bang Olufsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bang Olufsen has no effect on the direction of Citigroup i.e., Citigroup and Bang Olufsen go up and down completely randomly.
Pair Corralation between Citigroup and Bang Olufsen
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.6 times more return on investment than Bang Olufsen. However, Citigroup is 1.6 times more volatile than Bang Olufsen. It trades about 0.21 of its potential returns per unit of risk. Bang Olufsen is currently generating about 0.09 per unit of risk. If you would invest 6,360 in Citigroup on August 29, 2024 and sell it today you would earn a total of 615.00 from holding Citigroup or generate 9.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Bang Olufsen
Performance |
| Timeline |
| Citigroup |
| Bang Olufsen |
Citigroup and Bang Olufsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Bang Olufsen
The main advantage of trading using opposite Citigroup and Bang Olufsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Bang Olufsen 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 Bang Olufsen will offset losses from the drop in Bang Olufsen's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Bang Olufsen vs. FLSmidth Co | Bang Olufsen vs. Ambu AS | Bang Olufsen vs. GN Store Nord | Bang Olufsen vs. ISS AS |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |