Correlation Between Citigroup and Delphax Technologies
Can any of the company-specific risk be diversified away by investing in both Citigroup and Delphax Technologies 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 Delphax Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Delphax Technologies, you can compare the effects of market volatilities on Citigroup and Delphax Technologies 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 Delphax Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Delphax Technologies.
Diversification Opportunities for Citigroup and Delphax Technologies
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Delphax is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Delphax Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delphax Technologies 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 Delphax Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delphax Technologies has no effect on the direction of Citigroup i.e., Citigroup and Delphax Technologies go up and down completely randomly.
Pair Corralation between Citigroup and Delphax Technologies
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.3 times more return on investment than Delphax Technologies. However, Citigroup is 3.36 times less risky than Delphax Technologies. It trades about 0.08 of its potential returns per unit of risk. Delphax Technologies is currently generating about -0.02 per unit of risk. If you would invest 4,525 in Citigroup on August 31, 2024 and sell it today you would earn a total of 2,562 from holding Citigroup or generate 56.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 8.29% |
| Values | Daily Returns |
Citigroup vs. Delphax Technologies
Performance |
| Timeline |
| Citigroup |
| Delphax Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Delphax Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Delphax Technologies
The main advantage of trading using opposite Citigroup and Delphax Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Delphax Technologies 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 Delphax Technologies will offset losses from the drop in Delphax Technologies' 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |