Correlation Between Citigroup and Grupa KTY
Can any of the company-specific risk be diversified away by investing in both Citigroup and Grupa KTY 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 Grupa KTY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Grupa KTY SA, you can compare the effects of market volatilities on Citigroup and Grupa KTY 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 Grupa KTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Grupa KTY.
Diversification Opportunities for Citigroup and Grupa KTY
Excellent diversification
The 3 months correlation between Citigroup and Grupa is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Grupa KTY SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupa KTY SA 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 Grupa KTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupa KTY SA has no effect on the direction of Citigroup i.e., Citigroup and Grupa KTY go up and down completely randomly.
Pair Corralation between Citigroup and Grupa KTY
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.91 times more return on investment than Grupa KTY. However, Citigroup is 1.1 times less risky than Grupa KTY. It trades about 0.08 of its potential returns per unit of risk. Grupa KTY SA is currently generating about 0.07 per unit of risk. If you would invest 4,037 in Citigroup on September 10, 2024 and sell it today you would earn a total of 3,178 from holding Citigroup or generate 78.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Grupa KTY SA
Performance |
| Timeline |
| Citigroup |
| Grupa KTY SA |
Citigroup and Grupa KTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Grupa KTY
The main advantage of trading using opposite Citigroup and Grupa KTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Grupa KTY 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 Grupa KTY will offset losses from the drop in Grupa KTY's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Grupa KTY vs. Bank Millennium SA | Grupa KTY vs. Monnari Trade SA | Grupa KTY vs. MW Trade SA | Grupa KTY vs. Saule Technologies SA |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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