Correlation Between Citigroup and CONX Corp
Can any of the company-specific risk be diversified away by investing in both Citigroup and CONX Corp 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 CONX Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and CONX Corp, you can compare the effects of market volatilities on Citigroup and CONX Corp 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 CONX Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and CONX Corp.
Diversification Opportunities for Citigroup and CONX Corp
Poor diversification
The 3 months correlation between Citigroup and CONX is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and CONX Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONX Corp 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 CONX Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONX Corp has no effect on the direction of Citigroup i.e., Citigroup and CONX Corp go up and down completely randomly.
Pair Corralation between Citigroup and CONX Corp
If you would invest 6,235 in Citigroup on September 4, 2024 and sell it today you would earn a total of 904.00 from holding Citigroup or generate 14.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Citigroup vs. CONX Corp
Performance |
| Timeline |
| Citigroup |
| CONX Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and CONX Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and CONX Corp
The main advantage of trading using opposite Citigroup and CONX Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, CONX Corp 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 CONX Corp will offset losses from the drop in CONX Corp's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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