Correlation Between Citigroup and Guardian Capital
Can any of the company-specific risk be diversified away by investing in both Citigroup and Guardian Capital 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 Guardian Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Guardian Capital Group, you can compare the effects of market volatilities on Citigroup and Guardian Capital 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 Guardian Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Guardian Capital.
Diversification Opportunities for Citigroup and Guardian Capital
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and Guardian is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Guardian Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Capital 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 Guardian Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Capital has no effect on the direction of Citigroup i.e., Citigroup and Guardian Capital go up and down completely randomly.
Pair Corralation between Citigroup and Guardian Capital
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.55 times more return on investment than Guardian Capital. However, Citigroup is 1.55 times more volatile than Guardian Capital Group. It trades about 0.07 of its potential returns per unit of risk. Guardian Capital Group is currently generating about -0.02 per unit of risk. If you would invest 6,064 in Citigroup on September 3, 2024 and sell it today you would earn a total of 1,023 from holding Citigroup or generate 16.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Guardian Capital Group
Performance |
| Timeline |
| Citigroup |
| Guardian Capital |
Citigroup and Guardian Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Guardian Capital
The main advantage of trading using opposite Citigroup and Guardian Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Guardian Capital 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 Guardian Capital will offset losses from the drop in Guardian Capital's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Guardian Capital vs. Guardian Capital Group | Guardian Capital vs. Andrew Peller Limited | Guardian Capital vs. K Bro Linen | Guardian Capital vs. AGF Management Limited |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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