Correlation Between Citigroup and Doubleline Emerging
Can any of the company-specific risk be diversified away by investing in both Citigroup and Doubleline Emerging 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 Doubleline Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Doubleline Emerging Markets, you can compare the effects of market volatilities on Citigroup and Doubleline Emerging 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 Doubleline Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Doubleline Emerging.
Diversification Opportunities for Citigroup and Doubleline Emerging
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Doubleline is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Doubleline Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Emerging 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 Doubleline Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Emerging has no effect on the direction of Citigroup i.e., Citigroup and Doubleline Emerging go up and down completely randomly.
Pair Corralation between Citigroup and Doubleline Emerging
Taking into account the 90-day investment horizon Citigroup is expected to generate 4.6 times more return on investment than Doubleline Emerging. However, Citigroup is 4.6 times more volatile than Doubleline Emerging Markets. It trades about 0.21 of its potential returns per unit of risk. Doubleline Emerging Markets is currently generating about -0.13 per unit of risk. If you would invest 6,393 in Citigroup on August 31, 2024 and sell it today you would earn a total of 623.00 from holding Citigroup or generate 9.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Doubleline Emerging Markets
Performance |
| Timeline |
| Citigroup |
| Doubleline Emerging |
Citigroup and Doubleline Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Doubleline Emerging
The main advantage of trading using opposite Citigroup and Doubleline Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Doubleline Emerging 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 Doubleline Emerging will offset losses from the drop in Doubleline Emerging's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Doubleline Emerging vs. Pimco Emerging Local | Doubleline Emerging vs. HUMANA INC | Doubleline Emerging vs. Aquagold International | Doubleline Emerging vs. Barloworld Ltd ADR |
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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