Correlation Between Citigroup and HAV Group
Can any of the company-specific risk be diversified away by investing in both Citigroup and HAV Group 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 HAV Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and HAV Group ASA, you can compare the effects of market volatilities on Citigroup and HAV Group 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 HAV Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and HAV Group.
Diversification Opportunities for Citigroup and HAV Group
Excellent diversification
The 3 months correlation between Citigroup and HAV is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and HAV Group ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAV Group ASA 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 HAV Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAV Group ASA has no effect on the direction of Citigroup i.e., Citigroup and HAV Group go up and down completely randomly.
Pair Corralation between Citigroup and HAV Group
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.63 times more return on investment than HAV Group. However, Citigroup is 1.58 times less risky than HAV Group. It trades about 0.13 of its potential returns per unit of risk. HAV Group ASA is currently generating about -0.04 per unit of risk. If you would invest 4,053 in Citigroup on September 1, 2024 and sell it today you would earn a total of 3,034 from holding Citigroup or generate 74.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.26% |
| Values | Daily Returns |
Citigroup vs. HAV Group ASA
Performance |
| Timeline |
| Citigroup |
| HAV Group ASA |
Citigroup and HAV Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and HAV Group
The main advantage of trading using opposite Citigroup and HAV Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, HAV Group 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 HAV Group will offset losses from the drop in HAV Group's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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