Correlation Between Citigroup and CP All
Can any of the company-specific risk be diversified away by investing in both Citigroup and CP All 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 CP All into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and CP All PCL, you can compare the effects of market volatilities on Citigroup and CP All 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 CP All. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and CP All.
Diversification Opportunities for Citigroup and CP All
Modest diversification
The 3 months correlation between Citigroup and CPPCY is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and CP All PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CP All PCL 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 CP All. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CP All PCL has no effect on the direction of Citigroup i.e., Citigroup and CP All go up and down completely randomly.
Pair Corralation between Citigroup and CP All
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.87 times more return on investment than CP All. However, Citigroup is 1.16 times less risky than CP All. It trades about 0.27 of its potential returns per unit of risk. CP All PCL is currently generating about 0.22 per unit of risk. 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 | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. CP All PCL
Performance |
| Timeline |
| Citigroup |
| CP All PCL |
Citigroup and CP All Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and CP All
The main advantage of trading using opposite Citigroup and CP All positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, CP All 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 CP All will offset losses from the drop in CP All's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| CP All vs. Carrefour SA PK | CP All vs. J Sainsbury PLC | CP All vs. Sendas Distribuidora SA | CP All vs. Weis Markets |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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