Correlation Between Citigroup and Harrow Health
Can any of the company-specific risk be diversified away by investing in both Citigroup and Harrow Health 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 Harrow Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Harrow Health, you can compare the effects of market volatilities on Citigroup and Harrow Health 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 Harrow Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Harrow Health.
Diversification Opportunities for Citigroup and Harrow Health
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Citigroup and Harrow is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Harrow Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harrow Health 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 Harrow Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harrow Health has no effect on the direction of Citigroup i.e., Citigroup and Harrow Health go up and down completely randomly.
Pair Corralation between Citigroup and Harrow Health
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.38 times more return on investment than Harrow Health. However, Citigroup is 2.63 times less risky than Harrow Health. It trades about 0.23 of its potential returns per unit of risk. Harrow Health is currently generating about -0.06 per unit of risk. If you would invest 6,360 in Citigroup on August 27, 2024 and sell it today you would earn a total of 624.00 from holding Citigroup or generate 9.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Harrow Health
Performance |
| Timeline |
| Citigroup |
| Harrow Health |
Citigroup and Harrow Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Harrow Health
The main advantage of trading using opposite Citigroup and Harrow Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Harrow Health 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 Harrow Health will offset losses from the drop in Harrow Health's long position.| Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
| Harrow Health vs. Apyx Medical | Harrow Health vs. Eton Pharmaceuticals | Harrow Health vs. Scpharmaceuticals | Harrow Health vs. Fennec Pharmaceuticals |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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