Correlation Between Citigroup and China Conch
Can any of the company-specific risk be diversified away by investing in both Citigroup and China Conch 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 China Conch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and China Conch Venture, you can compare the effects of market volatilities on Citigroup and China Conch 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 China Conch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and China Conch.
Diversification Opportunities for Citigroup and China Conch
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and China is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and China Conch Venture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Conch Venture 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 China Conch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Conch Venture has no effect on the direction of Citigroup i.e., Citigroup and China Conch go up and down completely randomly.
Pair Corralation between Citigroup and China Conch
If you would invest 93.00 in China Conch Venture on November 28, 2024 and sell it today you would earn a total of 0.00 from holding China Conch Venture or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. China Conch Venture
Performance |
| Timeline |
| Citigroup |
| China Conch Venture |
Citigroup and China Conch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and China Conch
The main advantage of trading using opposite Citigroup and China Conch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, China Conch 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 China Conch will offset losses from the drop in China Conch's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| China Conch vs. Arrow Electronics | China Conch vs. Jerash Holdings | China Conch vs. Boot Barn Holdings | China Conch vs. Grounded People Apparel |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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