Correlation Between Citigroup and Ivy Energy
Can any of the company-specific risk be diversified away by investing in both Citigroup and Ivy Energy 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 Ivy Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Ivy Energy Fund, you can compare the effects of market volatilities on Citigroup and Ivy Energy 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 Ivy Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Ivy Energy.
Diversification Opportunities for Citigroup and Ivy Energy
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Ivy is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Ivy Energy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivy Energy Fund 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 Ivy Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivy Energy Fund has no effect on the direction of Citigroup i.e., Citigroup and Ivy Energy go up and down completely randomly.
Pair Corralation between Citigroup and Ivy Energy
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.35 times more return on investment than Ivy Energy. However, Citigroup is 2.35 times more volatile than Ivy Energy Fund. It trades about 0.16 of its potential returns per unit of risk. Ivy Energy Fund is currently generating about -0.12 per unit of risk. If you would invest 6,083 in Citigroup on August 25, 2024 and sell it today you would earn a total of 901.00 from holding Citigroup or generate 14.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Ivy Energy Fund
Performance |
| Timeline |
| Citigroup |
| Ivy Energy Fund |
Citigroup and Ivy Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Ivy Energy
The main advantage of trading using opposite Citigroup and Ivy Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Ivy Energy 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 Ivy Energy will offset losses from the drop in Ivy Energy's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Ivy Energy vs. Optimum Small Mid Cap | Ivy Energy vs. Optimum Small Mid Cap | Ivy Energy vs. First Investors Select | Ivy Energy vs. First Investors Select |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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