Correlation Between Citigroup and Gmo Treasury
Can any of the company-specific risk be diversified away by investing in both Citigroup and Gmo Treasury 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 Gmo Treasury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Gmo Treasury Fund, you can compare the effects of market volatilities on Citigroup and Gmo Treasury 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 Gmo Treasury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Gmo Treasury.
Diversification Opportunities for Citigroup and Gmo Treasury
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Gmo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Gmo Treasury Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Treasury 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 Gmo Treasury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Treasury has no effect on the direction of Citigroup i.e., Citigroup and Gmo Treasury go up and down completely randomly.
Pair Corralation between Citigroup and Gmo Treasury
Taking into account the 90-day investment horizon Citigroup is expected to generate 20.44 times more return on investment than Gmo Treasury. However, Citigroup is 20.44 times more volatile than Gmo Treasury Fund. It trades about 0.1 of its potential returns per unit of risk. Gmo Treasury Fund is currently generating about 0.14 per unit of risk. If you would invest 4,959 in Citigroup on August 25, 2024 and sell it today you would earn a total of 2,025 from holding Citigroup or generate 40.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Gmo Treasury Fund
Performance |
| Timeline |
| Citigroup |
| Gmo Treasury |
Citigroup and Gmo Treasury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Gmo Treasury
The main advantage of trading using opposite Citigroup and Gmo Treasury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Gmo Treasury 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 Gmo Treasury will offset losses from the drop in Gmo Treasury's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Gmo Treasury vs. Gmo E Plus | Gmo Treasury vs. Gmo Trust | Gmo Treasury vs. Gmo Trust | Gmo Treasury vs. Gmo Emerging Markets |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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