Correlation Between Citigroup and Minesto AB
Can any of the company-specific risk be diversified away by investing in both Citigroup and Minesto AB 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 Minesto AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Minesto AB, you can compare the effects of market volatilities on Citigroup and Minesto AB 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 Minesto AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Minesto AB.
Diversification Opportunities for Citigroup and Minesto AB
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Minesto is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Minesto AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minesto AB 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 Minesto AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minesto AB has no effect on the direction of Citigroup i.e., Citigroup and Minesto AB go up and down completely randomly.
Pair Corralation between Citigroup and Minesto AB
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.54 times more return on investment than Minesto AB. However, Citigroup is 1.84 times less risky than Minesto AB. It trades about 0.22 of its potential returns per unit of risk. Minesto AB is currently generating about -0.2 per unit of risk. If you would invest 6,360 in Citigroup on August 29, 2024 and sell it today you would earn a total of 656.00 from holding Citigroup or generate 10.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Minesto AB
Performance |
| Timeline |
| Citigroup |
| Minesto AB |
Citigroup and Minesto AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Minesto AB
The main advantage of trading using opposite Citigroup and Minesto AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Minesto AB 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 Minesto AB will offset losses from the drop in Minesto AB's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Minesto AB vs. SolTech Energy Sweden | Minesto AB vs. Eolus Vind AB | Minesto AB vs. Climeon AB | Minesto AB vs. Powercell Sweden |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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