Correlation Between Citigroup and Helmerich Payne
Can any of the company-specific risk be diversified away by investing in both Citigroup and Helmerich Payne 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 Helmerich Payne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Helmerich Payne, you can compare the effects of market volatilities on Citigroup and Helmerich Payne 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 Helmerich Payne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Helmerich Payne.
Diversification Opportunities for Citigroup and Helmerich Payne
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Helmerich is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Helmerich Payne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helmerich Payne 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 Helmerich Payne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helmerich Payne has no effect on the direction of Citigroup i.e., Citigroup and Helmerich Payne go up and down completely randomly.
Pair Corralation between Citigroup and Helmerich Payne
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.77 times more return on investment than Helmerich Payne. However, Citigroup is 1.3 times less risky than Helmerich Payne. It trades about 0.26 of its potential returns per unit of risk. Helmerich Payne is currently generating about 0.12 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 Together |
| Strength | Strong |
| Accuracy | 91.3% |
| Values | Daily Returns |
Citigroup vs. Helmerich Payne
Performance |
| Timeline |
| Citigroup |
| Helmerich Payne |
Citigroup and Helmerich Payne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Helmerich Payne
The main advantage of trading using opposite Citigroup and Helmerich Payne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Helmerich Payne 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 Helmerich Payne will offset losses from the drop in Helmerich Payne's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Helmerich Payne vs. ARDAGH METAL PACDL 0001 | Helmerich Payne vs. DAIRY FARM INTL | Helmerich Payne vs. PARKEN Sport Entertainment | Helmerich Payne vs. Granite Construction |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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