Correlation Between Citigroup and Pyramisa Hotels
Can any of the company-specific risk be diversified away by investing in both Citigroup and Pyramisa Hotels 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 Pyramisa Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Pyramisa Hotels, you can compare the effects of market volatilities on Citigroup and Pyramisa Hotels 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 Pyramisa Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Pyramisa Hotels.
Diversification Opportunities for Citigroup and Pyramisa Hotels
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Pyramisa is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Pyramisa Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pyramisa Hotels 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 Pyramisa Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pyramisa Hotels has no effect on the direction of Citigroup i.e., Citigroup and Pyramisa Hotels go up and down completely randomly.
Pair Corralation between Citigroup and Pyramisa Hotels
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.19 times less return on investment than Pyramisa Hotels. But when comparing it to its historical volatility, Citigroup is 1.76 times less risky than Pyramisa Hotels. It trades about 0.12 of its potential returns per unit of risk. Pyramisa Hotels is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 9,037 in Pyramisa Hotels on August 31, 2024 and sell it today you would earn a total of 3,910 from holding Pyramisa Hotels or generate 43.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 77.91% |
| Values | Daily Returns |
Citigroup vs. Pyramisa Hotels
Performance |
| Timeline |
| Citigroup |
| Pyramisa Hotels |
Citigroup and Pyramisa Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Pyramisa Hotels
The main advantage of trading using opposite Citigroup and Pyramisa Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Pyramisa Hotels 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 Pyramisa Hotels will offset losses from the drop in Pyramisa Hotels' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Pyramisa Hotels vs. Act Financial | Pyramisa Hotels vs. Egypt Aluminum | Pyramisa Hotels vs. Faisal Islamic Bank | Pyramisa Hotels vs. National Bank |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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