Correlation Between Citigroup and BANPU POWER
Can any of the company-specific risk be diversified away by investing in both Citigroup and BANPU POWER 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 BANPU POWER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and BANPU POWER, you can compare the effects of market volatilities on Citigroup and BANPU POWER 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 BANPU POWER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and BANPU POWER.
Diversification Opportunities for Citigroup and BANPU POWER
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and BANPU is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and BANPU POWER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANPU POWER 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 BANPU POWER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANPU POWER has no effect on the direction of Citigroup i.e., Citigroup and BANPU POWER go up and down completely randomly.
Pair Corralation between Citigroup and BANPU POWER
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.45 times more return on investment than BANPU POWER. However, Citigroup is 1.45 times more volatile than BANPU POWER. It trades about 0.1 of its potential returns per unit of risk. BANPU POWER is currently generating about -0.02 per unit of risk. If you would invest 4,460 in Citigroup on September 12, 2024 and sell it today you would earn a total of 2,790 from holding Citigroup or generate 62.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.59% |
| Values | Daily Returns |
Citigroup vs. BANPU POWER
Performance |
| Timeline |
| Citigroup |
| BANPU POWER |
Citigroup and BANPU POWER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and BANPU POWER
The main advantage of trading using opposite Citigroup and BANPU POWER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, BANPU POWER 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 BANPU POWER will offset losses from the drop in BANPU POWER's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| BANPU POWER vs. Charoen Pokphand Foods | BANPU POWER vs. The Siam Cement | BANPU POWER vs. Ratch Group Public | BANPU POWER vs. Amata 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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