Correlation Between Citigroup and Brilliant Acquisition
Can any of the company-specific risk be diversified away by investing in both Citigroup and Brilliant Acquisition 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 Brilliant Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Brilliant Acquisition Corp, you can compare the effects of market volatilities on Citigroup and Brilliant Acquisition 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 Brilliant Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Brilliant Acquisition.
Diversification Opportunities for Citigroup and Brilliant Acquisition
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Brilliant is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Brilliant Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brilliant Acquisition 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 Brilliant Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brilliant Acquisition has no effect on the direction of Citigroup i.e., Citigroup and Brilliant Acquisition go up and down completely randomly.
Pair Corralation between Citigroup and Brilliant Acquisition
If you would invest 6,079 in Citigroup on September 1, 2024 and sell it today you would earn a total of 1,008 from holding Citigroup or generate 16.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.79% |
| Values | Daily Returns |
Citigroup vs. Brilliant Acquisition Corp
Performance |
| Timeline |
| Citigroup |
| Brilliant Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Brilliant Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Brilliant Acquisition
The main advantage of trading using opposite Citigroup and Brilliant Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Brilliant Acquisition 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 Brilliant Acquisition will offset losses from the drop in Brilliant Acquisition's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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