Correlation Between Citigroup and Netas Telekomunikasyon
Can any of the company-specific risk be diversified away by investing in both Citigroup and Netas Telekomunikasyon 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 Netas Telekomunikasyon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Netas Telekomunikasyon AS, you can compare the effects of market volatilities on Citigroup and Netas Telekomunikasyon 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 Netas Telekomunikasyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Netas Telekomunikasyon.
Diversification Opportunities for Citigroup and Netas Telekomunikasyon
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Netas is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Netas Telekomunikasyon AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netas Telekomunikasyon 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 Netas Telekomunikasyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netas Telekomunikasyon has no effect on the direction of Citigroup i.e., Citigroup and Netas Telekomunikasyon go up and down completely randomly.
Pair Corralation between Citigroup and Netas Telekomunikasyon
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.66 times less return on investment than Netas Telekomunikasyon. But when comparing it to its historical volatility, Citigroup is 2.54 times less risky than Netas Telekomunikasyon. It trades about 0.07 of its potential returns per unit of risk. Netas Telekomunikasyon AS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4,054 in Netas Telekomunikasyon AS on August 28, 2024 and sell it today you would earn a total of 3,216 from holding Netas Telekomunikasyon AS or generate 79.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Netas Telekomunikasyon AS
Performance |
| Timeline |
| Citigroup |
| Netas Telekomunikasyon |
Citigroup and Netas Telekomunikasyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Netas Telekomunikasyon
The main advantage of trading using opposite Citigroup and Netas Telekomunikasyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Netas Telekomunikasyon 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 Netas Telekomunikasyon will offset losses from the drop in Netas Telekomunikasyon's long position.| Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal | Citigroup vs. Bank of Nova |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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