Correlation Between Citigroup and Bts Managed
Can any of the company-specific risk be diversified away by investing in both Citigroup and Bts Managed 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 Bts Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Bts Managed Income, you can compare the effects of market volatilities on Citigroup and Bts Managed 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 Bts Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Bts Managed.
Diversification Opportunities for Citigroup and Bts Managed
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Bts is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Bts Managed Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bts Managed Income 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 Bts Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bts Managed Income has no effect on the direction of Citigroup i.e., Citigroup and Bts Managed go up and down completely randomly.
Pair Corralation between Citigroup and Bts Managed
Taking into account the 90-day investment horizon Citigroup is expected to generate 10.07 times more return on investment than Bts Managed. However, Citigroup is 10.07 times more volatile than Bts Managed Income. It trades about 0.21 of its potential returns per unit of risk. Bts Managed Income is currently generating about 0.3 per unit of risk. If you would invest 6,255 in Citigroup on August 24, 2024 and sell it today you would earn a total of 640.00 from holding Citigroup or generate 10.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Bts Managed Income
Performance |
| Timeline |
| Citigroup |
| Bts Managed Income |
Citigroup and Bts Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Bts Managed
The main advantage of trading using opposite Citigroup and Bts Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Bts Managed 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 Bts Managed will offset losses from the drop in Bts Managed's long position.| Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Royal Bank of | Citigroup vs. JPMorgan Chase Co |
| Bts Managed vs. T Rowe Price | Bts Managed vs. Transamerica Intermediate Muni | Bts Managed vs. Dws Government Money | Bts Managed vs. T Rowe Price |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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