Correlation Between Citigroup and Nationwide Bailard
Can any of the company-specific risk be diversified away by investing in both Citigroup and Nationwide Bailard 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 Nationwide Bailard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Nationwide Bailard Nitive, you can compare the effects of market volatilities on Citigroup and Nationwide Bailard 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 Nationwide Bailard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Nationwide Bailard.
Diversification Opportunities for Citigroup and Nationwide Bailard
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citigroup and Nationwide is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Nationwide Bailard Nitive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Bailard Nitive 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 Nationwide Bailard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Bailard Nitive has no effect on the direction of Citigroup i.e., Citigroup and Nationwide Bailard go up and down completely randomly.
Pair Corralation between Citigroup and Nationwide Bailard
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.35 times more return on investment than Nationwide Bailard. However, Citigroup is 1.35 times more volatile than Nationwide Bailard Nitive. It trades about 0.26 of its potential returns per unit of risk. Nationwide Bailard Nitive is currently generating about 0.3 per unit of risk. If you would invest 6,361 in Citigroup on September 1, 2024 and sell it today you would earn a total of 726.00 from holding Citigroup or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. Nationwide Bailard Nitive
Performance |
| Timeline |
| Citigroup |
| Nationwide Bailard Nitive |
Citigroup and Nationwide Bailard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Nationwide Bailard
The main advantage of trading using opposite Citigroup and Nationwide Bailard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Nationwide Bailard 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 Nationwide Bailard will offset losses from the drop in Nationwide Bailard's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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