Correlation Between Citigroup and Class 1
Can any of the company-specific risk be diversified away by investing in both Citigroup and Class 1 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 Class 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Class 1 Nickel, you can compare the effects of market volatilities on Citigroup and Class 1 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 Class 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Class 1.
Diversification Opportunities for Citigroup and Class 1
Very poor diversification
The 3 months correlation between Citigroup and Class is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Class 1 Nickel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Class 1 Nickel 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 Class 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Class 1 Nickel has no effect on the direction of Citigroup i.e., Citigroup and Class 1 go up and down completely randomly.
Pair Corralation between Citigroup and Class 1
Taking into account the 90-day investment horizon Citigroup is expected to generate 9.98 times less return on investment than Class 1. But when comparing it to its historical volatility, Citigroup is 9.1 times less risky than Class 1. It trades about 0.13 of its potential returns per unit of risk. Class 1 Nickel is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 9.40 in Class 1 Nickel on September 3, 2024 and sell it today you would earn a total of 8.60 from holding Class 1 Nickel or generate 91.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 79.69% |
| Values | Daily Returns |
Citigroup vs. Class 1 Nickel
Performance |
| Timeline |
| Citigroup |
| Class 1 Nickel |
Citigroup and Class 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Class 1
The main advantage of trading using opposite Citigroup and Class 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Class 1 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 Class 1 will offset losses from the drop in Class 1's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Class 1 vs. Green Battery Minerals | Class 1 vs. Pampa Metals | Class 1 vs. EcoGraf Limited | Class 1 vs. Mundoro Capital |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |