Correlation Between Citigroup and HEINEKEN
Can any of the company-specific risk be diversified away by investing in both Citigroup and HEINEKEN 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 HEINEKEN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and HEINEKEN SP ADR, you can compare the effects of market volatilities on Citigroup and HEINEKEN 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 HEINEKEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and HEINEKEN.
Diversification Opportunities for Citigroup and HEINEKEN
Pay attention - limited upside
The 3 months correlation between Citigroup and HEINEKEN is -0.94. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and HEINEKEN SP ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEINEKEN SP ADR 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 HEINEKEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEINEKEN SP ADR has no effect on the direction of Citigroup i.e., Citigroup and HEINEKEN go up and down completely randomly.
Pair Corralation between Citigroup and HEINEKEN
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.0 times more return on investment than HEINEKEN. However, Citigroup is 2.0 times more volatile than HEINEKEN SP ADR. It trades about 0.26 of its potential returns per unit of risk. HEINEKEN SP ADR is currently generating about -0.36 per unit of risk. If you would invest 6,361 in Citigroup on September 1, 2024 and sell it today you would earn a total of 726.00 from holding Citigroup or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. HEINEKEN SP ADR
Performance |
| Timeline |
| Citigroup |
| HEINEKEN SP ADR |
Citigroup and HEINEKEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and HEINEKEN
The main advantage of trading using opposite Citigroup and HEINEKEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, HEINEKEN 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 HEINEKEN will offset losses from the drop in HEINEKEN's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| HEINEKEN vs. INDOFOOD AGRI RES | HEINEKEN vs. Cleanaway Waste Management | HEINEKEN vs. Beyond Meat | HEINEKEN vs. AUSNUTRIA DAIRY |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |