Correlation Between Citigroup and Horizon Esg
Can any of the company-specific risk be diversified away by investing in both Citigroup and Horizon Esg 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 Horizon Esg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Horizon Esg Defensive, you can compare the effects of market volatilities on Citigroup and Horizon Esg 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 Horizon Esg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Horizon Esg.
Diversification Opportunities for Citigroup and Horizon Esg
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Horizon is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Horizon Esg Defensive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Esg Defensive 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 Horizon Esg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Esg Defensive has no effect on the direction of Citigroup i.e., Citigroup and Horizon Esg go up and down completely randomly.
Pair Corralation between Citigroup and Horizon Esg
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Horizon Esg. In addition to that, Citigroup is 2.37 times more volatile than Horizon Esg Defensive. It trades about -0.08 of its total potential returns per unit of risk. Horizon Esg Defensive is currently generating about -0.15 per unit of volatility. If you would invest 4,119 in Horizon Esg Defensive on January 12, 2025 and sell it today you would lose (239.00) from holding Horizon Esg Defensive or give up 5.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Horizon Esg Defensive
Performance |
| Timeline |
| Citigroup |
| Horizon Esg Defensive |
Citigroup and Horizon Esg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Horizon Esg
The main advantage of trading using opposite Citigroup and Horizon Esg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Horizon Esg 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 Horizon Esg will offset losses from the drop in Horizon Esg's long position.| Citigroup vs. Barclays PLC ADR | Citigroup vs. ING Group NV | Citigroup vs. Banco Santander SA | Citigroup vs. HSBC Holdings PLC |
| Horizon Esg vs. Delaware Limited Term Diversified | Horizon Esg vs. Oppenheimer International Diversified | Horizon Esg vs. Lord Abbett Diversified | Horizon Esg vs. Columbia Diversified Equity |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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