Correlation Between Citigroup and Ito En
Can any of the company-specific risk be diversified away by investing in both Citigroup and Ito En 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 Ito En into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Ito En, you can compare the effects of market volatilities on Citigroup and Ito En 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 Ito En. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Ito En.
Diversification Opportunities for Citigroup and Ito En
Poor diversification
The 3 months correlation between Citigroup and Ito is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Ito En in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ito En 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 Ito En. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ito En has no effect on the direction of Citigroup i.e., Citigroup and Ito En go up and down completely randomly.
Pair Corralation between Citigroup and Ito En
If you would invest 5,683 in Citigroup on September 12, 2024 and sell it today you would earn a total of 1,513 from holding Citigroup or generate 26.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 1.56% |
| Values | Daily Returns |
Citigroup vs. Ito En
Performance |
| Timeline |
| Citigroup |
| Ito En |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Ito En Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Ito En
The main advantage of trading using opposite Citigroup and Ito En positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Ito En 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 Ito En will offset losses from the drop in Ito En's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Ito En vs. Inflection Point Acquisition | Ito En vs. Estee Lauder Companies | Ito En vs. Beauty Health Co | Ito En vs. Skechers USA |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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