Correlation Between Citigroup and Kaya Holdings
Can any of the company-specific risk be diversified away by investing in both Citigroup and Kaya Holdings 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 Kaya Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Kaya Holdings, you can compare the effects of market volatilities on Citigroup and Kaya Holdings 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 Kaya Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Kaya Holdings.
Diversification Opportunities for Citigroup and Kaya Holdings
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Kaya is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Kaya Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaya Holdings 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 Kaya Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaya Holdings has no effect on the direction of Citigroup i.e., Citigroup and Kaya Holdings go up and down completely randomly.
Pair Corralation between Citigroup and Kaya Holdings
Taking into account the 90-day investment horizon Citigroup is expected to generate 3.29 times less return on investment than Kaya Holdings. But when comparing it to its historical volatility, Citigroup is 6.21 times less risky than Kaya Holdings. It trades about 0.07 of its potential returns per unit of risk. Kaya Holdings is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6.42 in Kaya Holdings on September 2, 2024 and sell it today you would lose (2.62) from holding Kaya Holdings or give up 40.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Kaya Holdings
Performance |
| Timeline |
| Citigroup |
| Kaya Holdings |
Citigroup and Kaya Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Kaya Holdings
The main advantage of trading using opposite Citigroup and Kaya Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Kaya Holdings 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 Kaya Holdings will offset losses from the drop in Kaya Holdings' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Kaya Holdings vs. MPX International Corp | Kaya Holdings vs. Grown Rogue International | Kaya Holdings vs. Slang Worldwide | Kaya Holdings vs. Decibel Cannabis |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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