Correlation Between Citigroup and JPMorgan Chase
Can any of the company-specific risk be diversified away by investing in both Citigroup and JPMorgan Chase 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 JPMorgan Chase into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and JPMorgan Chase Co, you can compare the effects of market volatilities on Citigroup and JPMorgan Chase 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 JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and JPMorgan Chase.
Diversification Opportunities for Citigroup and JPMorgan Chase
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citigroup and JPMorgan is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase 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 JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of Citigroup i.e., Citigroup and JPMorgan Chase go up and down completely randomly.
Pair Corralation between Citigroup and JPMorgan Chase
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.77 times more return on investment than JPMorgan Chase. However, Citigroup is 1.3 times less risky than JPMorgan Chase. It trades about 0.29 of its potential returns per unit of risk. JPMorgan Chase Co is currently generating about 0.19 per unit of risk. If you would invest 6,122 in Citigroup on August 26, 2024 and sell it today you would earn a total of 862.00 from holding Citigroup or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. JPMorgan Chase Co
Performance |
| Timeline |
| Citigroup |
| JPMorgan Chase |
Citigroup and JPMorgan Chase Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and JPMorgan Chase
The main advantage of trading using opposite Citigroup and JPMorgan Chase positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, JPMorgan Chase 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 JPMorgan Chase will offset losses from the drop in JPMorgan Chase's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| JPMorgan Chase vs. Citigroup | JPMorgan Chase vs. Wells Fargo | JPMorgan Chase vs. Toronto Dominion Bank | JPMorgan Chase vs. Nu Holdings |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| CEOs Directory Screen CEOs from public companies around the world |