Correlation Between Citigroup and Global Warming
Can any of the company-specific risk be diversified away by investing in both Citigroup and Global Warming 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 Global Warming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Global Warming Solut, you can compare the effects of market volatilities on Citigroup and Global Warming 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 Global Warming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Global Warming.
Diversification Opportunities for Citigroup and Global Warming
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Global is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Global Warming Solut in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Warming Solut 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 Global Warming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Warming Solut has no effect on the direction of Citigroup i.e., Citigroup and Global Warming go up and down completely randomly.
Pair Corralation between Citigroup and Global Warming
Taking into account the 90-day investment horizon Citigroup is expected to generate 11.74 times less return on investment than Global Warming. But when comparing it to its historical volatility, Citigroup is 14.47 times less risky than Global Warming. It trades about 0.07 of its potential returns per unit of risk. Global Warming Solut is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 324.00 in Global Warming Solut on September 20, 2024 and sell it today you would lose (189.00) from holding Global Warming Solut or give up 58.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Global Warming Solut
Performance |
| Timeline |
| Citigroup |
| Global Warming Solut |
Citigroup and Global Warming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Global Warming
The main advantage of trading using opposite Citigroup and Global Warming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Global Warming 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 Global Warming will offset losses from the drop in Global Warming's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Global Warming vs. Darkpulse | Global Warming vs. Cepton Inc | Global Warming vs. Blacksky Technology | Global Warming vs. Coherent |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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