Correlation Between Citigroup and PT Bank
Can any of the company-specific risk be diversified away by investing in both Citigroup and PT Bank 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 PT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and PT Bank Central, you can compare the effects of market volatilities on Citigroup and PT Bank 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 PT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and PT Bank.
Diversification Opportunities for Citigroup and PT Bank
Very good diversification
The 3 months correlation between Citigroup and PBCRF is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and PT Bank Central in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Bank Central 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 PT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Bank Central has no effect on the direction of Citigroup i.e., Citigroup and PT Bank go up and down completely randomly.
Pair Corralation between Citigroup and PT Bank
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.42 times more return on investment than PT Bank. However, Citigroup is 2.41 times less risky than PT Bank. It trades about 0.09 of its potential returns per unit of risk. PT Bank Central is currently generating about 0.03 per unit of risk. If you would invest 5,422 in Citigroup on August 25, 2024 and sell it today you would earn a total of 1,562 from holding Citigroup or generate 28.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.89% |
| Values | Daily Returns |
Citigroup vs. PT Bank Central
Performance |
| Timeline |
| Citigroup |
| PT Bank Central |
Citigroup and PT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and PT Bank
The main advantage of trading using opposite Citigroup and PT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, PT Bank 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 PT Bank will offset losses from the drop in PT Bank's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| PT Bank vs. Standard Bank Group | PT Bank vs. PSB Holdings | PT Bank vs. United Overseas Bank | PT Bank vs. Turkiye Garanti Bankasi |
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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