Correlation Between Citigroup and Brookfield Property
Can any of the company-specific risk be diversified away by investing in both Citigroup and Brookfield Property 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 Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Brookfield Property Partners, you can compare the effects of market volatilities on Citigroup and Brookfield Property 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 Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Brookfield Property.
Diversification Opportunities for Citigroup and Brookfield Property
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Citigroup and Brookfield is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Brookfield Property Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Property 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 Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Property has no effect on the direction of Citigroup i.e., Citigroup and Brookfield Property go up and down completely randomly.
Pair Corralation between Citigroup and Brookfield Property
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.01 times more return on investment than Brookfield Property. However, Citigroup is 1.01 times more volatile than Brookfield Property Partners. It trades about 0.26 of its potential returns per unit of risk. Brookfield Property Partners is currently generating about 0.11 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 Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Brookfield Property Partners
Performance |
| Timeline |
| Citigroup |
| Brookfield Property |
Citigroup and Brookfield Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Brookfield Property
The main advantage of trading using opposite Citigroup and Brookfield Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Brookfield Property 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 Property will offset losses from the drop in Brookfield Property's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Brookfield Property vs. Brookfield Property Partners | Brookfield Property vs. AGNC Investment Corp | Brookfield Property vs. Brookfield Property Preferred | Brookfield Property vs. AGNC Investment Corp |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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