Correlation Between Citigroup and Biostar Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Citigroup and Biostar Pharmaceuticals 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 Biostar Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Biostar Pharmaceuticals, you can compare the effects of market volatilities on Citigroup and Biostar Pharmaceuticals 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 Biostar Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Biostar Pharmaceuticals.
Diversification Opportunities for Citigroup and Biostar Pharmaceuticals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Biostar is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Biostar Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biostar Pharmaceuticals 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 Biostar Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biostar Pharmaceuticals has no effect on the direction of Citigroup i.e., Citigroup and Biostar Pharmaceuticals go up and down completely randomly.
Pair Corralation between Citigroup and Biostar Pharmaceuticals
If you would invest 6,980 in Citigroup on September 12, 2024 and sell it today you would earn a total of 224.00 from holding Citigroup or generate 3.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Citigroup vs. Biostar Pharmaceuticals
Performance |
| Timeline |
| Citigroup |
| Biostar Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Biostar Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Biostar Pharmaceuticals
The main advantage of trading using opposite Citigroup and Biostar Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Biostar Pharmaceuticals 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 Biostar Pharmaceuticals will offset losses from the drop in Biostar Pharmaceuticals' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Biostar Pharmaceuticals vs. Lifecore Biomedical | Biostar Pharmaceuticals vs. Kamada | Biostar Pharmaceuticals vs. Shuttle Pharmaceuticals | Biostar Pharmaceuticals vs. Cumberland Pharmaceuticals |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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