Correlation Between Citigroup and Fiesta Restaurant
Can any of the company-specific risk be diversified away by investing in both Citigroup and Fiesta Restaurant 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 Fiesta Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Fiesta Restaurant Group, you can compare the effects of market volatilities on Citigroup and Fiesta Restaurant 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 Fiesta Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Fiesta Restaurant.
Diversification Opportunities for Citigroup and Fiesta Restaurant
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Citigroup and Fiesta is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Fiesta Restaurant Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiesta Restaurant 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 Fiesta Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiesta Restaurant has no effect on the direction of Citigroup i.e., Citigroup and Fiesta Restaurant go up and down completely randomly.
Pair Corralation between Citigroup and Fiesta Restaurant
If you would invest 6,360 in Citigroup on August 28, 2024 and sell it today you would earn a total of 715.00 from holding Citigroup or generate 11.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Citigroup vs. Fiesta Restaurant Group
Performance |
| Timeline |
| Citigroup |
| Fiesta Restaurant |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Fiesta Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Fiesta Restaurant
The main advantage of trading using opposite Citigroup and Fiesta Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Fiesta Restaurant 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 Fiesta Restaurant will offset losses from the drop in Fiesta Restaurant's long position.| Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
| Fiesta Restaurant vs. BJs Restaurants | Fiesta Restaurant vs. Dine Brands Global | Fiesta Restaurant vs. Brinker International | Fiesta Restaurant vs. FAT Brands |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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