Correlation Between Citigroup and Mfs Growth
Can any of the company-specific risk be diversified away by investing in both Citigroup and Mfs Growth 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 Mfs Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Mfs Growth Fund, you can compare the effects of market volatilities on Citigroup and Mfs Growth 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 Mfs Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Mfs Growth.
Diversification Opportunities for Citigroup and Mfs Growth
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Mfs is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Mfs Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Growth Fund 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 Mfs Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Growth Fund has no effect on the direction of Citigroup i.e., Citigroup and Mfs Growth go up and down completely randomly.
Pair Corralation between Citigroup and Mfs Growth
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.3 times more return on investment than Mfs Growth. However, Citigroup is 2.3 times more volatile than Mfs Growth Fund. It trades about 0.16 of its potential returns per unit of risk. Mfs Growth Fund is currently generating about 0.11 per unit of risk. If you would invest 6,083 in Citigroup on August 25, 2024 and sell it today you would earn a total of 901.00 from holding Citigroup or generate 14.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Mfs Growth Fund
Performance |
| Timeline |
| Citigroup |
| Mfs Growth Fund |
Citigroup and Mfs Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Mfs Growth
The main advantage of trading using opposite Citigroup and Mfs Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Mfs Growth 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 Mfs Growth will offset losses from the drop in Mfs Growth's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Mfs Growth vs. Mfs Value Fund | Mfs Growth vs. Mfs International Value | Mfs Growth vs. Mfs International Diversification | Mfs Growth vs. John Hancock Disciplined |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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