Correlation Between Citigroup and Dfa Ny
Can any of the company-specific risk be diversified away by investing in both Citigroup and Dfa Ny 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 Dfa Ny into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Dfa Ny Municipal, you can compare the effects of market volatilities on Citigroup and Dfa Ny 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 Dfa Ny. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Dfa Ny.
Diversification Opportunities for Citigroup and Dfa Ny
Very poor diversification
The 3 months correlation between Citigroup and DFA is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Dfa Ny Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa Ny Municipal 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 Dfa Ny. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa Ny Municipal has no effect on the direction of Citigroup i.e., Citigroup and Dfa Ny go up and down completely randomly.
Pair Corralation between Citigroup and Dfa Ny
Taking into account the 90-day investment horizon Citigroup is expected to generate 42.16 times more return on investment than Dfa Ny. However, Citigroup is 42.16 times more volatile than Dfa Ny Municipal. It trades about 0.07 of its potential returns per unit of risk. Dfa Ny Municipal is currently generating about 0.29 per unit of risk. If you would invest 6,079 in Citigroup on September 1, 2024 and sell it today you would earn a total of 1,008 from holding Citigroup or generate 16.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
Citigroup vs. Dfa Ny Municipal
Performance |
| Timeline |
| Citigroup |
| Dfa Ny Municipal |
Citigroup and Dfa Ny Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Dfa Ny
The main advantage of trading using opposite Citigroup and Dfa Ny positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Dfa Ny 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 Dfa Ny will offset losses from the drop in Dfa Ny's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Dfa Ny vs. Short Precious Metals | Dfa Ny vs. Sprott Gold Equity | Dfa Ny vs. Goldman Sachs Clean | Dfa Ny vs. James Balanced Golden |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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