Correlation Between Citigroup and Nuveen Kansas
Can any of the company-specific risk be diversified away by investing in both Citigroup and Nuveen Kansas 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 Nuveen Kansas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Nuveen Kansas Municipal, you can compare the effects of market volatilities on Citigroup and Nuveen Kansas 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 Nuveen Kansas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Nuveen Kansas.
Diversification Opportunities for Citigroup and Nuveen Kansas
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Nuveen is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Nuveen Kansas Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Kansas Municipal 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 Nuveen Kansas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Kansas Municipal has no effect on the direction of Citigroup i.e., Citigroup and Nuveen Kansas go up and down completely randomly.
Pair Corralation between Citigroup and Nuveen Kansas
Taking into account the 90-day investment horizon Citigroup is expected to generate 6.79 times more return on investment than Nuveen Kansas. However, Citigroup is 6.79 times more volatile than Nuveen Kansas Municipal. It trades about 0.21 of its potential returns per unit of risk. Nuveen Kansas Municipal is currently generating about 0.15 per unit of risk. If you would invest 6,360 in Citigroup on August 29, 2024 and sell it today you would earn a total of 615.00 from holding Citigroup or generate 9.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citigroup vs. Nuveen Kansas Municipal
Performance |
| Timeline |
| Citigroup |
| Nuveen Kansas Municipal |
Citigroup and Nuveen Kansas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Nuveen Kansas
The main advantage of trading using opposite Citigroup and Nuveen Kansas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Nuveen Kansas 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 Nuveen Kansas will offset losses from the drop in Nuveen Kansas' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Nuveen Kansas vs. Touchstone Ultra Short | Nuveen Kansas vs. Franklin Federal Limited Term | Nuveen Kansas vs. Calvert Short Duration | Nuveen Kansas vs. Sterling Capital Short |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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