Correlation Between Citigroup and JPMorgan Ireland
Can any of the company-specific risk be diversified away by investing in both Citigroup and JPMorgan Ireland 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 Ireland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and JPMorgan Ireland ICAV, you can compare the effects of market volatilities on Citigroup and JPMorgan Ireland 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 Ireland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and JPMorgan Ireland.
Diversification Opportunities for Citigroup and JPMorgan Ireland
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and JPMorgan is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and JPMorgan Ireland ICAV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Ireland ICAV 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 Ireland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Ireland ICAV has no effect on the direction of Citigroup i.e., Citigroup and JPMorgan Ireland go up and down completely randomly.
Pair Corralation between Citigroup and JPMorgan Ireland
Taking into account the 90-day investment horizon Citigroup is expected to generate 4.12 times more return on investment than JPMorgan Ireland. However, Citigroup is 4.12 times more volatile than JPMorgan Ireland ICAV. It trades about 0.33 of its potential returns per unit of risk. JPMorgan Ireland ICAV is currently generating about 0.17 per unit of risk. If you would invest 6,235 in Citigroup on September 3, 2024 and sell it today you would earn a total of 904.00 from holding Citigroup or generate 14.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Citigroup vs. JPMorgan Ireland ICAV
Performance |
| Timeline |
| Citigroup |
| JPMorgan Ireland ICAV |
Citigroup and JPMorgan Ireland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and JPMorgan Ireland
The main advantage of trading using opposite Citigroup and JPMorgan Ireland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, JPMorgan Ireland 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 Ireland will offset losses from the drop in JPMorgan Ireland's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| JPMorgan Ireland vs. JPMorgan ETFs ICAV | JPMorgan Ireland vs. JPMorgan ETFs ICAV | JPMorgan Ireland vs. JPMorgan ETFs Ireland | JPMorgan Ireland vs. JPMorgan ETFs Ireland |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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