Correlation Between Citigroup and Publicis Groupe
Can any of the company-specific risk be diversified away by investing in both Citigroup and Publicis Groupe 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 Publicis Groupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Publicis Groupe SA, you can compare the effects of market volatilities on Citigroup and Publicis Groupe 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 Publicis Groupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Publicis Groupe.
Diversification Opportunities for Citigroup and Publicis Groupe
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Publicis is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Publicis Groupe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Publicis Groupe SA 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 Publicis Groupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Publicis Groupe SA has no effect on the direction of Citigroup i.e., Citigroup and Publicis Groupe go up and down completely randomly.
Pair Corralation between Citigroup and Publicis Groupe
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.84 times more return on investment than Publicis Groupe. However, Citigroup is 1.2 times less risky than Publicis Groupe. It trades about 0.08 of its potential returns per unit of risk. Publicis Groupe SA is currently generating about 0.05 per unit of risk. If you would invest 4,558 in Citigroup on September 2, 2024 and sell it today you would earn a total of 2,529 from holding Citigroup or generate 55.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Publicis Groupe SA
Performance |
| Timeline |
| Citigroup |
| Publicis Groupe SA |
Citigroup and Publicis Groupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Publicis Groupe
The main advantage of trading using opposite Citigroup and Publicis Groupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Publicis Groupe 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 Publicis Groupe will offset losses from the drop in Publicis Groupe's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Publicis Groupe vs. Beyond Commerce | Publicis Groupe vs. Baosheng Media Group | Publicis Groupe vs. MGO Global Common | Publicis Groupe vs. CMG Holdings Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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