Correlation Between Citigroup and Mirriad Advertising
Can any of the company-specific risk be diversified away by investing in both Citigroup and Mirriad Advertising 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 Mirriad Advertising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Mirriad Advertising plc, you can compare the effects of market volatilities on Citigroup and Mirriad Advertising 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 Mirriad Advertising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Mirriad Advertising.
Diversification Opportunities for Citigroup and Mirriad Advertising
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Mirriad is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Mirriad Advertising plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirriad Advertising plc 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 Mirriad Advertising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirriad Advertising plc has no effect on the direction of Citigroup i.e., Citigroup and Mirriad Advertising go up and down completely randomly.
Pair Corralation between Citigroup and Mirriad Advertising
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.19 times more return on investment than Mirriad Advertising. However, Citigroup is 5.19 times less risky than Mirriad Advertising. It trades about 0.23 of its potential returns per unit of risk. Mirriad Advertising plc is currently generating about -0.22 per unit of risk. If you would invest 6,360 in Citigroup on August 27, 2024 and sell it today you would earn a total of 624.00 from holding Citigroup or generate 9.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Mirriad Advertising plc
Performance |
| Timeline |
| Citigroup |
| Mirriad Advertising plc |
Citigroup and Mirriad Advertising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Mirriad Advertising
The main advantage of trading using opposite Citigroup and Mirriad Advertising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Mirriad Advertising 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 Mirriad Advertising will offset losses from the drop in Mirriad Advertising's long position.| Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
| Mirriad Advertising vs. INEO Tech Corp | Mirriad Advertising vs. Kidoz Inc | Mirriad Advertising vs. Marchex | Mirriad Advertising vs. Snipp Interactive |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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