Correlation Between Citigroup and WisdomTree Japan
Can any of the company-specific risk be diversified away by investing in both Citigroup and WisdomTree Japan 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 WisdomTree Japan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and WisdomTree Japan Hedged, you can compare the effects of market volatilities on Citigroup and WisdomTree Japan 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 WisdomTree Japan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and WisdomTree Japan.
Diversification Opportunities for Citigroup and WisdomTree Japan
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and WisdomTree is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and WisdomTree Japan Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Japan Hedged 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 WisdomTree Japan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Japan Hedged has no effect on the direction of Citigroup i.e., Citigroup and WisdomTree Japan go up and down completely randomly.
Pair Corralation between Citigroup and WisdomTree Japan
If you would invest 9,969 in Citigroup on September 25, 2025 and sell it today you would earn a total of 1,971 from holding Citigroup or generate 19.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Citigroup vs. WisdomTree Japan Hedged
Performance |
| Timeline |
| Citigroup |
| WisdomTree Japan Hedged |
Risk-Adjusted Performance
Weakest
Weak | Strong |
Citigroup and WisdomTree Japan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and WisdomTree Japan
The main advantage of trading using opposite Citigroup and WisdomTree Japan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, WisdomTree Japan 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 WisdomTree Japan will offset losses from the drop in WisdomTree Japan's long position.The idea behind Citigroup and WisdomTree Japan Hedged pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |