Correlation Between Citigroup and Country Group
Can any of the company-specific risk be diversified away by investing in both Citigroup and Country Group 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 Country Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Country Group Holdings, you can compare the effects of market volatilities on Citigroup and Country Group 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 Country Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Country Group.
Diversification Opportunities for Citigroup and Country Group
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Country is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Country Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Country Group Holdings 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 Country Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Country Group Holdings has no effect on the direction of Citigroup i.e., Citigroup and Country Group go up and down completely randomly.
Pair Corralation between Citigroup and Country Group
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.65 times more return on investment than Country Group. However, Citigroup is 1.65 times more volatile than Country Group Holdings. It trades about 0.23 of its potential returns per unit of risk. Country Group Holdings is currently generating about -0.05 per unit of risk. If you would invest 6,393 in Citigroup on August 31, 2024 and sell it today you would earn a total of 694.00 from holding Citigroup or generate 10.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Country Group Holdings
Performance |
| Timeline |
| Citigroup |
| Country Group Holdings |
Citigroup and Country Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Country Group
The main advantage of trading using opposite Citigroup and Country Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Country Group 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 Country Group will offset losses from the drop in Country Group's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Country Group vs. Asia Plus Group | Country Group vs. Globlex Holding Management | Country Group vs. Asia Green Energy | Country Group vs. Amanah Leasing Public |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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