Correlation Between Citigroup and Qs Us
Can any of the company-specific risk be diversified away by investing in both Citigroup and Qs Us 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 Qs Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Qs Small Capitalization, you can compare the effects of market volatilities on Citigroup and Qs Us 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 Qs Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Qs Us.
Diversification Opportunities for Citigroup and Qs Us
Very poor diversification
The 3 months correlation between Citigroup and LMBMX is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Qs Small Capitalization in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qs Small Capitalization 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 Qs Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qs Small Capitalization has no effect on the direction of Citigroup i.e., Citigroup and Qs Us go up and down completely randomly.
Pair Corralation between Citigroup and Qs Us
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Qs Us. In addition to that, Citigroup is 1.38 times more volatile than Qs Small Capitalization. It trades about -0.08 of its total potential returns per unit of risk. Qs Small Capitalization is currently generating about -0.06 per unit of volatility. If you would invest 1,193 in Qs Small Capitalization on January 12, 2025 and sell it today you would lose (54.00) from holding Qs Small Capitalization or give up 4.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Qs Small Capitalization
Performance |
| Timeline |
| Citigroup |
| Qs Small Capitalization |
Citigroup and Qs Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Qs Us
The main advantage of trading using opposite Citigroup and Qs Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Qs Us 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 Qs Us will offset losses from the drop in Qs Us' long position.| Citigroup vs. Barclays PLC ADR | Citigroup vs. ING Group NV | Citigroup vs. Banco Santander SA | Citigroup vs. HSBC Holdings PLC |
| Qs Us vs. T Rowe Price | Qs Us vs. Applied Finance Explorer | Qs Us vs. Inverse Mid Cap Strategy | Qs Us vs. Ridgeworth Ceredex Mid Cap |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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