Correlation Between Citigroup and GABY
Can any of the company-specific risk be diversified away by investing in both Citigroup and GABY 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 GABY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and GABY Inc, you can compare the effects of market volatilities on Citigroup and GABY 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 GABY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and GABY.
Diversification Opportunities for Citigroup and GABY
Pay attention - limited upside
The 3 months correlation between Citigroup and GABY is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and GABY Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GABY Inc 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 GABY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GABY Inc has no effect on the direction of Citigroup i.e., Citigroup and GABY go up and down completely randomly.
Pair Corralation between Citigroup and GABY
Taking into account the 90-day investment horizon Citigroup is expected to generate 20.22 times less return on investment than GABY. But when comparing it to its historical volatility, Citigroup is 16.31 times less risky than GABY. It trades about 0.07 of its potential returns per unit of risk. GABY Inc is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.31 in GABY Inc on August 31, 2024 and sell it today you would lose (0.17) from holding GABY Inc or give up 54.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 84.94% |
| Values | Daily Returns |
Citigroup vs. GABY Inc
Performance |
| Timeline |
| Citigroup |
| GABY Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and GABY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and GABY
The main advantage of trading using opposite Citigroup and GABY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, GABY 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 GABY will offset losses from the drop in GABY's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| GABY vs. Nextplat Corp | GABY vs. Hudson Pacific Properties | GABY vs. Mativ Holdings | GABY vs. Amkor Technology |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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