Correlation Between Citigroup and Calvert Global
Can any of the company-specific risk be diversified away by investing in both Citigroup and Calvert 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 Calvert Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Calvert Global Energy, you can compare the effects of market volatilities on Citigroup and Calvert 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 Calvert Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Calvert Global.
Diversification Opportunities for Citigroup and Calvert Global
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Calvert is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Calvert Global Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Global Energy 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 Calvert Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Global Energy has no effect on the direction of Citigroup i.e., Citigroup and Calvert Global go up and down completely randomly.
Pair Corralation between Citigroup and Calvert Global
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.6 times more return on investment than Calvert Global. However, Citigroup is 1.6 times more volatile than Calvert Global Energy. It trades about 0.11 of its potential returns per unit of risk. Calvert Global Energy is currently generating about 0.02 per unit of risk. If you would invest 4,567 in Citigroup on August 29, 2024 and sell it today you would earn a total of 2,408 from holding Citigroup or generate 52.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Calvert Global Energy
Performance |
| Timeline |
| Citigroup |
| Calvert Global Energy |
Citigroup and Calvert Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Calvert Global
The main advantage of trading using opposite Citigroup and Calvert Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Calvert 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 Calvert Global will offset losses from the drop in Calvert Global's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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