Correlation Between Citigroup and Nippon Shinyaku
Can any of the company-specific risk be diversified away by investing in both Citigroup and Nippon Shinyaku 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 Nippon Shinyaku into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Nippon Shinyaku Co, you can compare the effects of market volatilities on Citigroup and Nippon Shinyaku 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 Nippon Shinyaku. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Nippon Shinyaku.
Diversification Opportunities for Citigroup and Nippon Shinyaku
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Citigroup and Nippon is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Nippon Shinyaku Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nippon Shinyaku 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 Nippon Shinyaku. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nippon Shinyaku has no effect on the direction of Citigroup i.e., Citigroup and Nippon Shinyaku go up and down completely randomly.
Pair Corralation between Citigroup and Nippon Shinyaku
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.19 times less return on investment than Nippon Shinyaku. But when comparing it to its historical volatility, Citigroup is 1.27 times less risky than Nippon Shinyaku. It trades about 0.02 of its potential returns per unit of risk. Nippon Shinyaku Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 591.00 in Nippon Shinyaku Co on January 15, 2025 and sell it today you would earn a total of 10.00 from holding Nippon Shinyaku Co or generate 1.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 68.48% |
| Values | Daily Returns |
Citigroup vs. Nippon Shinyaku Co
Performance |
| Timeline |
| Citigroup |
| Nippon Shinyaku |
Citigroup and Nippon Shinyaku Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Nippon Shinyaku
The main advantage of trading using opposite Citigroup and Nippon Shinyaku positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Nippon Shinyaku 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 Nippon Shinyaku will offset losses from the drop in Nippon Shinyaku's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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