Correlation Between Citigroup and Intchains Group
Can any of the company-specific risk be diversified away by investing in both Citigroup and Intchains Group 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 Intchains Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Intchains Group Limited, you can compare the effects of market volatilities on Citigroup and Intchains Group 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 Intchains Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Intchains Group.
Diversification Opportunities for Citigroup and Intchains Group
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Intchains is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Intchains Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intchains Group 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 Intchains Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intchains Group has no effect on the direction of Citigroup i.e., Citigroup and Intchains Group go up and down completely randomly.
Pair Corralation between Citigroup and Intchains Group
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.3 times more return on investment than Intchains Group. However, Citigroup is 3.36 times less risky than Intchains Group. It trades about 0.06 of its potential returns per unit of risk. Intchains Group Limited is currently generating about -0.05 per unit of risk. If you would invest 6,131 in Citigroup on August 25, 2024 and sell it today you would earn a total of 853.00 from holding Citigroup or generate 13.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Intchains Group Limited
Performance |
| Timeline |
| Citigroup |
| Intchains Group |
Citigroup and Intchains Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Intchains Group
The main advantage of trading using opposite Citigroup and Intchains Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Intchains Group 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 Intchains Group will offset losses from the drop in Intchains Group's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Intchains Group vs. Teradyne | Intchains Group vs. Veeco Instruments | Intchains Group vs. IPG Photonics | Intchains Group vs. Applied Materials |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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