Correlation Between Citigroup and JT ARCH
Can any of the company-specific risk be diversified away by investing in both Citigroup and JT ARCH 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 JT ARCH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and JT ARCH INVESTMENTS, you can compare the effects of market volatilities on Citigroup and JT ARCH 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 JT ARCH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and JT ARCH.
Diversification Opportunities for Citigroup and JT ARCH
Very poor diversification
The 3 months correlation between Citigroup and JTINA is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and JT ARCH INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JT ARCH INVESTMENTS 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 JT ARCH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JT ARCH INVESTMENTS has no effect on the direction of Citigroup i.e., Citigroup and JT ARCH go up and down completely randomly.
Pair Corralation between Citigroup and JT ARCH
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the JT ARCH. In addition to that, Citigroup is 9.91 times more volatile than JT ARCH INVESTMENTS. It trades about -0.08 of its total potential returns per unit of risk. JT ARCH INVESTMENTS is currently generating about 0.31 per unit of volatility. If you would invest 178.00 in JT ARCH INVESTMENTS on November 28, 2024 and sell it today you would earn a total of 2.00 from holding JT ARCH INVESTMENTS or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. JT ARCH INVESTMENTS
Performance |
| Timeline |
| Citigroup |
| JT ARCH INVESTMENTS |
Citigroup and JT ARCH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and JT ARCH
The main advantage of trading using opposite Citigroup and JT ARCH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, JT ARCH 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 JT ARCH will offset losses from the drop in JT ARCH's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| JT ARCH vs. Erste Group Bank | JT ARCH vs. Vienna Insurance Group | JT ARCH vs. Moneta Money Bank | JT ARCH vs. UNIQA Insurance Group |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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