Correlation Between Citigroup and Mainstay Mackay
Can any of the company-specific risk be diversified away by investing in both Citigroup and Mainstay Mackay 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 Mainstay Mackay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Mainstay Mackay Short, you can compare the effects of market volatilities on Citigroup and Mainstay Mackay 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 Mainstay Mackay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Mainstay Mackay.
Diversification Opportunities for Citigroup and Mainstay Mackay
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Mainstay is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Mainstay Mackay Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Mackay Short 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 Mainstay Mackay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Mackay Short has no effect on the direction of Citigroup i.e., Citigroup and Mainstay Mackay go up and down completely randomly.
Pair Corralation between Citigroup and Mainstay Mackay
Taking into account the 90-day investment horizon Citigroup is expected to generate 15.32 times more return on investment than Mainstay Mackay. However, Citigroup is 15.32 times more volatile than Mainstay Mackay Short. It trades about 0.06 of its potential returns per unit of risk. Mainstay Mackay Short is currently generating about 0.12 per unit of risk. If you would invest 4,651 in Citigroup on September 1, 2024 and sell it today you would earn a total of 2,436 from holding Citigroup or generate 52.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Mainstay Mackay Short
Performance |
| Timeline |
| Citigroup |
| Mainstay Mackay Short |
Citigroup and Mainstay Mackay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Mainstay Mackay
The main advantage of trading using opposite Citigroup and Mainstay Mackay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Mainstay Mackay 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 Mainstay Mackay will offset losses from the drop in Mainstay Mackay's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Mainstay Mackay vs. Mainstay High Yield | Mainstay Mackay vs. Mainstay Tax Free | Mainstay Mackay vs. Mainstay Income Builder | Mainstay Mackay vs. Mainstay Large Cap |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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