Correlation Between Citigroup and Plastiques
Can any of the company-specific risk be diversified away by investing in both Citigroup and Plastiques 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 Plastiques into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Plastiques du Val, you can compare the effects of market volatilities on Citigroup and Plastiques 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 Plastiques. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Plastiques.
Diversification Opportunities for Citigroup and Plastiques
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Plastiques is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Plastiques du Val in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plastiques du Val 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 Plastiques. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plastiques du Val has no effect on the direction of Citigroup i.e., Citigroup and Plastiques go up and down completely randomly.
Pair Corralation between Citigroup and Plastiques
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.66 times more return on investment than Plastiques. However, Citigroup is 1.5 times less risky than Plastiques. It trades about 0.09 of its potential returns per unit of risk. Plastiques du Val is currently generating about -0.09 per unit of risk. If you would invest 4,224 in Citigroup on August 26, 2024 and sell it today you would earn a total of 2,760 from holding Citigroup or generate 65.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.01% |
| Values | Daily Returns |
Citigroup vs. Plastiques du Val
Performance |
| Timeline |
| Citigroup |
| Plastiques du Val |
Citigroup and Plastiques Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Plastiques
The main advantage of trading using opposite Citigroup and Plastiques positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Plastiques 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 Plastiques will offset losses from the drop in Plastiques' long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Plastiques vs. Groupe Guillin SA | Plastiques vs. Groupe Partouche SA | Plastiques vs. Passat Socit Anonyme | Plastiques vs. Akwel SA |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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