Correlation Between Citigroup and First Trust
Can any of the company-specific risk be diversified away by investing in both Citigroup and First Trust 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 First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and First Trust High, you can compare the effects of market volatilities on Citigroup and First Trust 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 First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and First Trust.
Diversification Opportunities for Citigroup and First Trust
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and First is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and First Trust High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust High 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 First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust High has no effect on the direction of Citigroup i.e., Citigroup and First Trust go up and down completely randomly.
Pair Corralation between Citigroup and First Trust
If you would invest 6,315 in Citigroup on November 1, 2024 and sell it today you would earn a total of 1,871 from holding Citigroup or generate 29.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 1.67% |
| Values | Daily Returns |
Citigroup vs. First Trust High
Performance |
| Timeline |
| Citigroup |
| First Trust High |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and First Trust
The main advantage of trading using opposite Citigroup and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| Citigroup vs. Royal Bank of | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Canadian Imperial Bank |
| First Trust vs. Franklin Templeton Limited | First Trust vs. Blackrock Floating Rate | First Trust vs. Cohen Steers Limited | First Trust vs. Blackstone Gso Long |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |