Correlation Between Citigroup and Identiv
Can any of the company-specific risk be diversified away by investing in both Citigroup and Identiv 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 Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Identiv, you can compare the effects of market volatilities on Citigroup and Identiv 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 Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Identiv.
Diversification Opportunities for Citigroup and Identiv
Poor diversification
The 3 months correlation between Citigroup and Identiv is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Citigroup i.e., Citigroup and Identiv go up and down completely randomly.
Pair Corralation between Citigroup and Identiv
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.43 times less return on investment than Identiv. But when comparing it to its historical volatility, Citigroup is 1.58 times less risky than Identiv. It trades about 0.23 of its potential returns per unit of risk. Identiv is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 348.00 in Identiv on August 27, 2024 and sell it today you would earn a total of 48.00 from holding Identiv or generate 13.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Identiv
Performance |
| Timeline |
| Citigroup |
| Identiv |
Citigroup and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Identiv
The main advantage of trading using opposite Citigroup and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Identiv vs. TransAct Technologies Incorporated | Identiv vs. AGM Group Holdings | Identiv vs. AstroNova | Identiv vs. Key Tronic |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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