Correlation Between Citigroup and Nusantara Almazia
Can any of the company-specific risk be diversified away by investing in both Citigroup and Nusantara Almazia 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 Nusantara Almazia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Nusantara Almazia, you can compare the effects of market volatilities on Citigroup and Nusantara Almazia 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 Nusantara Almazia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Nusantara Almazia.
Diversification Opportunities for Citigroup and Nusantara Almazia
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Nusantara is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Nusantara Almazia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nusantara Almazia 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 Nusantara Almazia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nusantara Almazia has no effect on the direction of Citigroup i.e., Citigroup and Nusantara Almazia go up and down completely randomly.
Pair Corralation between Citigroup and Nusantara Almazia
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.31 times more return on investment than Nusantara Almazia. However, Citigroup is 3.26 times less risky than Nusantara Almazia. It trades about 0.08 of its potential returns per unit of risk. Nusantara Almazia is currently generating about -0.04 per unit of risk. If you would invest 4,525 in Citigroup on August 31, 2024 and sell it today you would earn a total of 2,562 from holding Citigroup or generate 56.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. Nusantara Almazia
Performance |
| Timeline |
| Citigroup |
| Nusantara Almazia |
Citigroup and Nusantara Almazia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Nusantara Almazia
The main advantage of trading using opposite Citigroup and Nusantara Almazia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Nusantara Almazia 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 Nusantara Almazia will offset losses from the drop in Nusantara Almazia'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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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