Correlation Between Citigroup and Arrow ETF
Can any of the company-specific risk be diversified away by investing in both Citigroup and Arrow ETF 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 Arrow ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Arrow ETF Trust, you can compare the effects of market volatilities on Citigroup and Arrow ETF 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 Arrow ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Arrow ETF.
Diversification Opportunities for Citigroup and Arrow ETF
Very good diversification
The 3 months correlation between Citigroup and Arrow is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Arrow ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow ETF Trust 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 Arrow ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow ETF Trust has no effect on the direction of Citigroup i.e., Citigroup and Arrow ETF go up and down completely randomly.
Pair Corralation between Citigroup and Arrow ETF
Taking into account the 90-day investment horizon Citigroup is expected to generate 3.23 times more return on investment than Arrow ETF. However, Citigroup is 3.23 times more volatile than Arrow ETF Trust. It trades about 0.07 of its potential returns per unit of risk. Arrow ETF Trust is currently generating about 0.06 per unit of risk. If you would invest 6,117 in Citigroup on August 29, 2024 and sell it today you would earn a total of 899.00 from holding Citigroup or generate 14.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Arrow ETF Trust
Performance |
| Timeline |
| Citigroup |
| Arrow ETF Trust |
Citigroup and Arrow ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Arrow ETF
The main advantage of trading using opposite Citigroup and Arrow ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Arrow ETF 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 Arrow ETF will offset losses from the drop in Arrow ETF's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Arrow ETF vs. iShares Morningstar Multi Asset | Arrow ETF vs. Amplify High Income | Arrow ETF vs. First Trust Multi Asset | Arrow ETF vs. SPDR SSgA Income |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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