Correlation Between Citigroup and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both Citigroup and Credit Suisse 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 Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Credit Suisse Group, you can compare the effects of market volatilities on Citigroup and Credit Suisse 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 Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Credit Suisse.
Diversification Opportunities for Citigroup and Credit Suisse
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Credit is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Credit Suisse Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Group 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 Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Group has no effect on the direction of Citigroup i.e., Citigroup and Credit Suisse go up and down completely randomly.
Pair Corralation between Citigroup and Credit Suisse
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.29 times more return on investment than Credit Suisse. However, Citigroup is 3.4 times less risky than Credit Suisse. It trades about 0.06 of its potential returns per unit of risk. Credit Suisse Group is currently generating about -0.14 per unit of risk. If you would invest 4,353 in Citigroup on August 23, 2024 and sell it today you would earn a total of 2,542 from holding Citigroup or generate 58.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 26.81% |
| Values | Daily Returns |
Citigroup vs. Credit Suisse Group
Performance |
| Timeline |
| Citigroup |
| Credit Suisse Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Credit Suisse
The main advantage of trading using opposite Citigroup and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.| Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Royal Bank of | Citigroup vs. JPMorgan Chase Co |
| Credit Suisse vs. Barclays PLC ADR | Credit Suisse vs. HSBC Holdings PLC | Credit Suisse vs. ING Group NV | Credit Suisse vs. Citigroup |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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