Correlation Between Citigroup and Lazard Us
Can any of the company-specific risk be diversified away by investing in both Citigroup and Lazard 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 Lazard Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Lazard Small Mid Cap, you can compare the effects of market volatilities on Citigroup and Lazard 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 Lazard Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Lazard Us.
Diversification Opportunities for Citigroup and Lazard Us
Very poor diversification
The 3 months correlation between Citigroup and Lazard is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Lazard Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard Small Mid 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 Lazard Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard Small Mid has no effect on the direction of Citigroup i.e., Citigroup and Lazard Us go up and down completely randomly.
Pair Corralation between Citigroup and Lazard Us
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.36 times more return on investment than Lazard Us. However, Citigroup is 1.36 times more volatile than Lazard Small Mid Cap. It trades about 0.08 of its potential returns per unit of risk. Lazard Small Mid Cap is currently generating about 0.04 per unit of risk. If you would invest 4,525 in Citigroup on August 31, 2024 and sell it today you would earn a total of 2,562 from holding Citigroup or generate 56.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.73% |
| Values | Daily Returns |
Citigroup vs. Lazard Small Mid Cap
Performance |
| Timeline |
| Citigroup |
| Lazard Small Mid |
Citigroup and Lazard Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Lazard Us
The main advantage of trading using opposite Citigroup and Lazard Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Lazard 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 Lazard Us will offset losses from the drop in Lazard Us' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Lazard Us vs. Vanguard Small Cap Index | Lazard Us vs. T Rowe Price | Lazard Us vs. HUMANA INC | Lazard Us vs. SCOR PK |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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