Correlation Between Citigroup and PUMA SE
Can any of the company-specific risk be diversified away by investing in both Citigroup and PUMA SE 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 PUMA SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and PUMA SE, you can compare the effects of market volatilities on Citigroup and PUMA SE 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 PUMA SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and PUMA SE.
Diversification Opportunities for Citigroup and PUMA SE
Poor diversification
The 3 months correlation between Citigroup and PUMA is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and PUMA SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PUMA SE 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 PUMA SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PUMA SE has no effect on the direction of Citigroup i.e., Citigroup and PUMA SE go up and down completely randomly.
Pair Corralation between Citigroup and PUMA SE
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.65 times more return on investment than PUMA SE. However, Citigroup is 1.55 times less risky than PUMA SE. It trades about 0.08 of its potential returns per unit of risk. PUMA SE is currently generating about 0.0 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 Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Citigroup vs. PUMA SE
Performance |
| Timeline |
| Citigroup |
| PUMA SE |
Citigroup and PUMA SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and PUMA SE
The main advantage of trading using opposite Citigroup and PUMA SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, PUMA SE 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 PUMA SE will offset losses from the drop in PUMA SE's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| PUMA SE vs. Asics Corp ADR | PUMA SE vs. American Rebel Holdings | PUMA SE vs. American Rebel Holdings | PUMA SE vs. Crocs Inc |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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