Correlation Between Citigroup and BANK CENTRAL
Can any of the company-specific risk be diversified away by investing in both Citigroup and BANK CENTRAL 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 BANK CENTRAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and BANK CENTRAL ASIA, you can compare the effects of market volatilities on Citigroup and BANK CENTRAL 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 BANK CENTRAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and BANK CENTRAL.
Diversification Opportunities for Citigroup and BANK CENTRAL
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and BANK is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and BANK CENTRAL ASIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK CENTRAL ASIA 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 BANK CENTRAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK CENTRAL ASIA has no effect on the direction of Citigroup i.e., Citigroup and BANK CENTRAL go up and down completely randomly.
Pair Corralation between Citigroup and BANK CENTRAL
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.03 times more return on investment than BANK CENTRAL. However, Citigroup is 1.03 times more volatile than BANK CENTRAL ASIA. It trades about 0.26 of its potential returns per unit of risk. BANK CENTRAL ASIA is currently generating about -0.06 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 Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Citigroup vs. BANK CENTRAL ASIA
Performance |
| Timeline |
| Citigroup |
| BANK CENTRAL ASIA |
Citigroup and BANK CENTRAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and BANK CENTRAL
The main advantage of trading using opposite Citigroup and BANK CENTRAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, BANK CENTRAL 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 BANK CENTRAL will offset losses from the drop in BANK CENTRAL's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| BANK CENTRAL vs. SIVERS SEMICONDUCTORS AB | BANK CENTRAL vs. Darden Restaurants | BANK CENTRAL vs. Reliance Steel Aluminum | BANK CENTRAL vs. Q2M Managementberatung AG |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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