Correlation Between Citigroup and ETHER
Can any of the company-specific risk be diversified away by investing in both Citigroup and ETHER 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 ETHER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and ETHER, you can compare the effects of market volatilities on Citigroup and ETHER 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 ETHER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and ETHER.
Diversification Opportunities for Citigroup and ETHER
Pay attention - limited upside
The 3 months correlation between Citigroup and ETHER is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and ETHER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETHER 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 ETHER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETHER has no effect on the direction of Citigroup i.e., Citigroup and ETHER go up and down completely randomly.
Pair Corralation between Citigroup and ETHER
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.37 times more return on investment than ETHER. However, Citigroup is 2.71 times less risky than ETHER. It trades about -0.04 of its potential returns per unit of risk. ETHER is currently generating about -0.17 per unit of risk. If you would invest 8,051 in Citigroup on November 28, 2024 and sell it today you would lose (144.00) from holding Citigroup or give up 1.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. ETHER
Performance |
| Timeline |
| Citigroup |
| ETHER |
Citigroup and ETHER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and ETHER
The main advantage of trading using opposite Citigroup and ETHER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, ETHER 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 ETHER will offset losses from the drop in ETHER's 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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