Correlation Between Citigroup and Flowr Corp
Can any of the company-specific risk be diversified away by investing in both Citigroup and Flowr Corp 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 Flowr Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Flowr Corp, you can compare the effects of market volatilities on Citigroup and Flowr Corp 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 Flowr Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Flowr Corp.
Diversification Opportunities for Citigroup and Flowr Corp
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Flowr is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Flowr Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flowr Corp 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 Flowr Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flowr Corp has no effect on the direction of Citigroup i.e., Citigroup and Flowr Corp go up and down completely randomly.
Pair Corralation between Citigroup and Flowr Corp
Taking into account the 90-day investment horizon Citigroup is expected to generate 155.96 times less return on investment than Flowr Corp. But when comparing it to its historical volatility, Citigroup is 91.3 times less risky than Flowr Corp. It trades about 0.08 of its potential returns per unit of risk. Flowr Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Flowr Corp on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Flowr Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 79.9% |
| Values | Daily Returns |
Citigroup vs. Flowr Corp
Performance |
| Timeline |
| Citigroup |
| Flowr Corp |
Citigroup and Flowr Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Flowr Corp
The main advantage of trading using opposite Citigroup and Flowr Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Flowr Corp 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 Flowr Corp will offset losses from the drop in Flowr Corp's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Flowr Corp vs. THC Therapeutics | Flowr Corp vs. Elixinol Global | Flowr Corp vs. Eisai Co | Flowr Corp vs. Mc Endvrs |
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 Stocks Directory module to find actively traded stocks across global markets.
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