Correlation Between Citigroup and Cable One
Can any of the company-specific risk be diversified away by investing in both Citigroup and Cable One 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 Cable One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Cable One, you can compare the effects of market volatilities on Citigroup and Cable One 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 Cable One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Cable One.
Diversification Opportunities for Citigroup and Cable One
Poor diversification
The 3 months correlation between Citigroup and Cable is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Cable One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cable One 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 Cable One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cable One has no effect on the direction of Citigroup i.e., Citigroup and Cable One go up and down completely randomly.
Pair Corralation between Citigroup and Cable One
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.09 times less return on investment than Cable One. In addition to that, Citigroup is 1.08 times more volatile than Cable One. It trades about 0.21 of its total potential returns per unit of risk. Cable One is currently generating about 0.47 per unit of volatility. If you would invest 970.00 in Cable One on August 24, 2024 and sell it today you would earn a total of 203.00 from holding Cable One or generate 20.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Citigroup vs. Cable One
Performance |
| Timeline |
| Citigroup |
| Cable One |
Citigroup and Cable One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Cable One
The main advantage of trading using opposite Citigroup and Cable One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Cable One 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 Cable One will offset losses from the drop in Cable One's long position.| Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Royal Bank of | Citigroup vs. JPMorgan Chase Co |
| Cable One vs. Credit Acceptance | Cable One vs. Sumitomo Mitsui Financial | Cable One vs. Mitsubishi UFJ Financial | Cable One vs. Micron Technology |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |