Correlation Between Citigroup and Pro Real
Can any of the company-specific risk be diversified away by investing in both Citigroup and Pro Real 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 Pro Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Pro Real Estate, you can compare the effects of market volatilities on Citigroup and Pro Real 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 Pro Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Pro Real.
Diversification Opportunities for Citigroup and Pro Real
Good diversification
The 3 months correlation between Citigroup and Pro is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Pro Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pro Real Estate 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 Pro Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pro Real Estate has no effect on the direction of Citigroup i.e., Citigroup and Pro Real go up and down completely randomly.
Pair Corralation between Citigroup and Pro Real
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.07 times more return on investment than Pro Real. However, Citigroup is 1.07 times more volatile than Pro Real Estate. It trades about 0.08 of its potential returns per unit of risk. Pro Real Estate is currently generating about 0.04 per unit of risk. If you would invest 4,525 in Citigroup on August 31, 2024 and sell it today you would earn a total of 2,562 from holding Citigroup or generate 56.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Citigroup vs. Pro Real Estate
Performance |
| Timeline |
| Citigroup |
| Pro Real Estate |
Citigroup and Pro Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Pro Real
The main advantage of trading using opposite Citigroup and Pro Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Pro Real 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 Pro Real will offset losses from the drop in Pro Real's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Pro Real vs. BTB Real Estate | Pro Real vs. Slate Office REIT | Pro Real vs. Nexus Real Estate | Pro Real vs. True North Commercial |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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