Correlation Between Citigroup and Codan
Can any of the company-specific risk be diversified away by investing in both Citigroup and Codan 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 Codan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Codan Limited, you can compare the effects of market volatilities on Citigroup and Codan 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 Codan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Codan.
Diversification Opportunities for Citigroup and Codan
Very weak diversification
The 3 months correlation between Citigroup and Codan is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Codan Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codan Limited 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 Codan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codan Limited has no effect on the direction of Citigroup i.e., Citigroup and Codan go up and down completely randomly.
Pair Corralation between Citigroup and Codan
If you would invest 6,315 in Citigroup on September 2, 2024 and sell it today you would earn a total of 772.00 from holding Citigroup or generate 12.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Citigroup vs. Codan Limited
Performance |
| Timeline |
| Citigroup |
| Codan Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Codan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Codan
The main advantage of trading using opposite Citigroup and Codan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Codan 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 Codan will offset losses from the drop in Codan's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Codan vs. Nanalysis Scientific Corp | Codan vs. Genasys | Codan vs. Kraken Robotics | Codan vs. Teledyne Technologies Incorporated |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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