Correlation Between Citigroup and Lyxor Net
Can any of the company-specific risk be diversified away by investing in both Citigroup and Lyxor Net 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 Lyxor Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Lyxor Net Zero, you can compare the effects of market volatilities on Citigroup and Lyxor Net 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 Lyxor Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Lyxor Net.
Diversification Opportunities for Citigroup and Lyxor Net
Very poor diversification
The 3 months correlation between Citigroup and Lyxor is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Lyxor Net Zero in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor Net Zero 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 Lyxor Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor Net Zero has no effect on the direction of Citigroup i.e., Citigroup and Lyxor Net go up and down completely randomly.
Pair Corralation between Citigroup and Lyxor Net
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.44 times more return on investment than Lyxor Net. However, Citigroup is 2.44 times more volatile than Lyxor Net Zero. It trades about 0.29 of its potential returns per unit of risk. Lyxor Net Zero is currently generating about 0.09 per unit of risk. If you would invest 6,122 in Citigroup on August 26, 2024 and sell it today you would earn a total of 862.00 from holding Citigroup or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Lyxor Net Zero
Performance |
| Timeline |
| Citigroup |
| Lyxor Net Zero |
Citigroup and Lyxor Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Lyxor Net
The main advantage of trading using opposite Citigroup and Lyxor Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Lyxor Net 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 Lyxor Net will offset losses from the drop in Lyxor Net's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Lyxor Net vs. Lyxor SP 500 | Lyxor Net vs. Lyxor UCITS Daily | Lyxor Net vs. Lyxor UCITS MSCI | Lyxor Net vs. Lyxor Treasury 10Y |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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