Correlation Between Citigroup and CTP NV
Can any of the company-specific risk be diversified away by investing in both Citigroup and CTP NV 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 CTP NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and CTP NV, you can compare the effects of market volatilities on Citigroup and CTP NV 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 CTP NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and CTP NV.
Diversification Opportunities for Citigroup and CTP NV
Pay attention - limited upside
The 3 months correlation between Citigroup and CTP is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and CTP NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CTP NV 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 CTP NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CTP NV has no effect on the direction of Citigroup i.e., Citigroup and CTP NV go up and down completely randomly.
Pair Corralation between Citigroup and CTP NV
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.47 times more return on investment than CTP NV. However, Citigroup is 1.47 times more volatile than CTP NV. It trades about 0.27 of its potential returns per unit of risk. CTP NV is currently generating about -0.03 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 Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. CTP NV
Performance |
| Timeline |
| Citigroup |
| CTP NV |
Citigroup and CTP NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and CTP NV
The main advantage of trading using opposite Citigroup and CTP NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, CTP NV 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 CTP NV will offset losses from the drop in CTP NV's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| CTP NV vs. Warehouses de Pauw | CTP NV vs. VGP NV | CTP NV vs. Eurocommercial Properties NV | CTP NV vs. Koninklijke Heijmans NV |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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