Correlation Between Citigroup and Marsico Focus
Can any of the company-specific risk be diversified away by investing in both Citigroup and Marsico Focus 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 Marsico Focus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Marsico Focus Fund, you can compare the effects of market volatilities on Citigroup and Marsico Focus 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 Marsico Focus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Marsico Focus.
Diversification Opportunities for Citigroup and Marsico Focus
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Marsico is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Marsico Focus Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marsico Focus 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 Marsico Focus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marsico Focus has no effect on the direction of Citigroup i.e., Citigroup and Marsico Focus go up and down completely randomly.
Pair Corralation between Citigroup and Marsico Focus
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.21 times more return on investment than Marsico Focus. However, Citigroup is 1.21 times more volatile than Marsico Focus Fund. It trades about 0.07 of its potential returns per unit of risk. Marsico Focus Fund is currently generating about 0.08 per unit of risk. If you would invest 4,134 in Citigroup on August 30, 2024 and sell it today you would earn a total of 2,882 from holding Citigroup or generate 69.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Marsico Focus Fund
Performance |
| Timeline |
| Citigroup |
| Marsico Focus |
Citigroup and Marsico Focus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Marsico Focus
The main advantage of trading using opposite Citigroup and Marsico Focus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Marsico Focus 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 Marsico Focus will offset losses from the drop in Marsico Focus' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Marsico Focus vs. Growth Fund Of | Marsico Focus vs. HUMANA INC | Marsico Focus vs. Aquagold International | Marsico Focus vs. Barloworld Ltd ADR |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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