Correlation Between Citigroup and IShares V
Can any of the company-specific risk be diversified away by investing in both Citigroup and IShares V 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 IShares V into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and iShares V PLC, you can compare the effects of market volatilities on Citigroup and IShares V 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 IShares V. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and IShares V.
Diversification Opportunities for Citigroup and IShares V
Very poor diversification
The 3 months correlation between Citigroup and IShares is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and iShares V PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares V PLC 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 IShares V. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares V PLC has no effect on the direction of Citigroup i.e., Citigroup and IShares V go up and down completely randomly.
Pair Corralation between Citigroup and IShares V
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the IShares V. In addition to that, Citigroup is 9.99 times more volatile than iShares V PLC. It trades about -0.04 of its total potential returns per unit of risk. iShares V PLC is currently generating about 0.21 per unit of volatility. If you would invest 514.00 in iShares V PLC on September 19, 2024 and sell it today you would earn a total of 3.00 from holding iShares V PLC or generate 0.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citigroup vs. iShares V PLC
Performance |
| Timeline |
| Citigroup |
| iShares V PLC |
Citigroup and IShares V Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and IShares V
The main advantage of trading using opposite Citigroup and IShares V positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, IShares V 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 IShares V will offset losses from the drop in IShares V's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| IShares V vs. Lyxor UCITS Japan | IShares V vs. Lyxor UCITS Japan | IShares V vs. Lyxor UCITS Stoxx | IShares V vs. Amundi CAC 40 |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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