Correlation Between Citigroup and Evertz Technologies
Can any of the company-specific risk be diversified away by investing in both Citigroup and Evertz 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 Evertz Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Evertz Technologies Limited, you can compare the effects of market volatilities on Citigroup and Evertz 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 Evertz Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Evertz Technologies.
Diversification Opportunities for Citigroup and Evertz Technologies
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Evertz is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Evertz Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evertz 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 Evertz Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evertz Technologies has no effect on the direction of Citigroup i.e., Citigroup and Evertz Technologies go up and down completely randomly.
Pair Corralation between Citigroup and Evertz Technologies
Taking into account the 90-day investment horizon Citigroup is expected to generate 29.3 times more return on investment than Evertz Technologies. However, Citigroup is 29.3 times more volatile than Evertz Technologies Limited. It trades about 0.15 of its potential returns per unit of risk. Evertz Technologies Limited is currently generating about -0.15 per unit of risk. If you would invest 6,205 in Citigroup on August 30, 2024 and sell it today you would earn a total of 811.00 from holding Citigroup or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Citigroup vs. Evertz Technologies Limited
Performance |
| Timeline |
| Citigroup |
| Evertz Technologies |
Citigroup and Evertz Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Evertz Technologies
The main advantage of trading using opposite Citigroup and Evertz Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Evertz 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 Evertz Technologies will offset losses from the drop in Evertz Technologies' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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