Correlation Between Citigroup and Fks Multi
Can any of the company-specific risk be diversified away by investing in both Citigroup and Fks Multi 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 Fks Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Fks Multi Agro, you can compare the effects of market volatilities on Citigroup and Fks Multi 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 Fks Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Fks Multi.
Diversification Opportunities for Citigroup and Fks Multi
Poor diversification
The 3 months correlation between Citigroup and Fks is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Fks Multi Agro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fks Multi Agro 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 Fks Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fks Multi Agro has no effect on the direction of Citigroup i.e., Citigroup and Fks Multi go up and down completely randomly.
Pair Corralation between Citigroup and Fks Multi
Taking into account the 90-day investment horizon Citigroup is expected to generate 16.52 times more return on investment than Fks Multi. However, Citigroup is 16.52 times more volatile than Fks Multi Agro. It trades about 0.24 of its potential returns per unit of risk. Fks Multi Agro is currently generating about -0.31 per unit of risk. If you would invest 6,245 in Citigroup on August 25, 2024 and sell it today you would earn a total of 739.00 from holding Citigroup or generate 11.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Fks Multi Agro
Performance |
| Timeline |
| Citigroup |
| Fks Multi Agro |
Citigroup and Fks Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Fks Multi
The main advantage of trading using opposite Citigroup and Fks Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Fks Multi 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 Fks Multi will offset losses from the drop in Fks Multi's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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