Correlation Between Citigroup and Lipella Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Citigroup and Lipella Pharmaceuticals 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 Lipella Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Lipella Pharmaceuticals Common, you can compare the effects of market volatilities on Citigroup and Lipella Pharmaceuticals 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 Lipella Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Lipella Pharmaceuticals.
Diversification Opportunities for Citigroup and Lipella Pharmaceuticals
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Lipella is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Lipella Pharmaceuticals Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipella Pharmaceuticals 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 Lipella Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lipella Pharmaceuticals has no effect on the direction of Citigroup i.e., Citigroup and Lipella Pharmaceuticals go up and down completely randomly.
Pair Corralation between Citigroup and Lipella Pharmaceuticals
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.17 times more return on investment than Lipella Pharmaceuticals. However, Citigroup is 5.85 times less risky than Lipella Pharmaceuticals. It trades about 0.12 of its potential returns per unit of risk. Lipella Pharmaceuticals Common is currently generating about -0.02 per unit of risk. If you would invest 4,411 in Citigroup on August 25, 2024 and sell it today you would earn a total of 2,573 from holding Citigroup or generate 58.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Lipella Pharmaceuticals Common
Performance |
| Timeline |
| Citigroup |
| Lipella Pharmaceuticals |
Citigroup and Lipella Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Lipella Pharmaceuticals
The main advantage of trading using opposite Citigroup and Lipella Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Lipella Pharmaceuticals 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 Lipella Pharmaceuticals will offset losses from the drop in Lipella Pharmaceuticals' long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Lipella Pharmaceuticals vs. Senti Biosciences | Lipella Pharmaceuticals vs. Fennec Pharmaceuticals | Lipella Pharmaceuticals vs. Monopar Therapeutics | Lipella Pharmaceuticals vs. Akeso, Inc |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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