Correlation Between Citigroup and FingerMotion
Can any of the company-specific risk be diversified away by investing in both Citigroup and FingerMotion 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 FingerMotion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and FingerMotion, you can compare the effects of market volatilities on Citigroup and FingerMotion 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 FingerMotion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and FingerMotion.
Diversification Opportunities for Citigroup and FingerMotion
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and FingerMotion is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and FingerMotion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FingerMotion 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 FingerMotion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FingerMotion has no effect on the direction of Citigroup i.e., Citigroup and FingerMotion go up and down completely randomly.
Pair Corralation between Citigroup and FingerMotion
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.59 times more return on investment than FingerMotion. However, Citigroup is 1.7 times less risky than FingerMotion. It trades about 0.21 of its potential returns per unit of risk. FingerMotion is currently generating about 0.04 per unit of risk. If you would invest 6,255 in Citigroup on August 24, 2024 and sell it today you would earn a total of 640.00 from holding Citigroup or generate 10.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citigroup vs. FingerMotion
Performance |
| Timeline |
| Citigroup |
| FingerMotion |
Citigroup and FingerMotion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and FingerMotion
The main advantage of trading using opposite Citigroup and FingerMotion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, FingerMotion 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 FingerMotion will offset losses from the drop in FingerMotion's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| FingerMotion vs. Liberty Broadband Srs | FingerMotion vs. KT Corporation | FingerMotion vs. Liberty Broadband Srs | FingerMotion vs. Consolidated Communications |
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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