Correlation Between Citigroup and Cannabis Global
Can any of the company-specific risk be diversified away by investing in both Citigroup and Cannabis Global 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 Cannabis Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Cannabis Global, you can compare the effects of market volatilities on Citigroup and Cannabis Global 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 Cannabis Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Cannabis Global.
Diversification Opportunities for Citigroup and Cannabis Global
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Cannabis is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Cannabis Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannabis Global 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 Cannabis Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannabis Global has no effect on the direction of Citigroup i.e., Citigroup and Cannabis Global go up and down completely randomly.
Pair Corralation between Citigroup and Cannabis Global
Taking into account the 90-day investment horizon Citigroup is expected to generate 175.28 times less return on investment than Cannabis Global. But when comparing it to its historical volatility, Citigroup is 144.7 times less risky than Cannabis Global. It trades about 0.22 of its potential returns per unit of risk. Cannabis Global is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Cannabis Global on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Cannabis Global or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Cannabis Global
Performance |
| Timeline |
| Citigroup |
| Cannabis Global |
Citigroup and Cannabis Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Cannabis Global
The main advantage of trading using opposite Citigroup and Cannabis Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Cannabis Global 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 Cannabis Global will offset losses from the drop in Cannabis Global's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Cannabis Global vs. Green Cures Botanical | Cannabis Global vs. Cann American Corp | Cannabis Global vs. Rimrock Gold Corp | Cannabis Global vs. Galexxy 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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