Correlation Between Citigroup and Poalim Ibi
Can any of the company-specific risk be diversified away by investing in both Citigroup and Poalim Ibi 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 Poalim Ibi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Poalim Ibi, you can compare the effects of market volatilities on Citigroup and Poalim Ibi 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 Poalim Ibi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Poalim Ibi.
Diversification Opportunities for Citigroup and Poalim Ibi
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Poalim is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Poalim Ibi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poalim Ibi 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 Poalim Ibi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poalim Ibi has no effect on the direction of Citigroup i.e., Citigroup and Poalim Ibi go up and down completely randomly.
Pair Corralation between Citigroup and Poalim Ibi
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.09 times more return on investment than Poalim Ibi. However, Citigroup is 1.09 times more volatile than Poalim Ibi. It trades about 0.27 of its potential returns per unit of risk. Poalim Ibi is currently generating about 0.16 per unit of risk. If you would invest 6,315 in Citigroup on September 2, 2024 and sell it today you would earn a total of 772.00 from holding Citigroup or generate 12.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 80.95% |
| Values | Daily Returns |
Citigroup vs. Poalim Ibi
Performance |
| Timeline |
| Citigroup |
| Poalim Ibi |
Citigroup and Poalim Ibi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Poalim Ibi
The main advantage of trading using opposite Citigroup and Poalim Ibi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Poalim Ibi 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 Poalim Ibi will offset losses from the drop in Poalim Ibi's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Poalim Ibi vs. Electreon Wireless | Poalim Ibi vs. First International Bank | Poalim Ibi vs. Bank Leumi Le Israel | Poalim Ibi vs. Batm Advanced Communications |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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