Correlation Between Citigroup and Metal Sky
Can any of the company-specific risk be diversified away by investing in both Citigroup and Metal Sky 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 Metal Sky into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Metal Sky Star, you can compare the effects of market volatilities on Citigroup and Metal Sky 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 Metal Sky. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Metal Sky.
Diversification Opportunities for Citigroup and Metal Sky
Very good diversification
The 3 months correlation between Citigroup and Metal is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Metal Sky Star in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metal Sky Star 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 Metal Sky. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metal Sky Star has no effect on the direction of Citigroup i.e., Citigroup and Metal Sky go up and down completely randomly.
Pair Corralation between Citigroup and Metal Sky
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.11 times more return on investment than Metal Sky. However, Citigroup is 9.47 times less risky than Metal Sky. It trades about 0.04 of its potential returns per unit of risk. Metal Sky Star is currently generating about -0.25 per unit of risk. If you would invest 7,250 in Citigroup on October 11, 2024 and sell it today you would earn a total of 76.00 from holding Citigroup or generate 1.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 28.57% |
| Values | Daily Returns |
Citigroup vs. Metal Sky Star
Performance |
| Timeline |
| Citigroup |
| Metal Sky Star |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Citigroup and Metal Sky Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Metal Sky
The main advantage of trading using opposite Citigroup and Metal Sky positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Metal Sky 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 Metal Sky will offset losses from the drop in Metal Sky's long position.| Citigroup vs. Royal Bank of | Citigroup vs. JPMorgan Chase Co | Citigroup vs. Nu Holdings | Citigroup vs. Canadian Imperial Bank |
| Metal Sky vs. Cebu Air ADR | Metal Sky vs. Westinghouse Air Brake | Metal Sky vs. Victorias Secret Co | Metal Sky vs. Contextlogic |
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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