Correlation Between Citigroup and Pimco Realpath
Can any of the company-specific risk be diversified away by investing in both Citigroup and Pimco Realpath 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 Pimco Realpath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Pimco Realpath Blend, you can compare the effects of market volatilities on Citigroup and Pimco Realpath 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 Pimco Realpath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Pimco Realpath.
Diversification Opportunities for Citigroup and Pimco Realpath
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Pimco is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Pimco Realpath Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pimco Realpath Blend 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 Pimco Realpath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pimco Realpath Blend has no effect on the direction of Citigroup i.e., Citigroup and Pimco Realpath go up and down completely randomly.
Pair Corralation between Citigroup and Pimco Realpath
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.65 times more return on investment than Pimco Realpath. However, Citigroup is 2.65 times more volatile than Pimco Realpath Blend. It trades about 0.12 of its potential returns per unit of risk. Pimco Realpath Blend is currently generating about 0.13 per unit of risk. If you would invest 4,364 in Citigroup on September 14, 2024 and sell it today you would earn a total of 2,737 from holding Citigroup or generate 62.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.63% |
| Values | Daily Returns |
Citigroup vs. Pimco Realpath Blend
Performance |
| Timeline |
| Citigroup |
| Pimco Realpath Blend |
Citigroup and Pimco Realpath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Pimco Realpath
The main advantage of trading using opposite Citigroup and Pimco Realpath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Pimco Realpath 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 Pimco Realpath will offset losses from the drop in Pimco Realpath's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Pimco Realpath vs. Pimco Realpath Blend | Pimco Realpath vs. Pimco Realpath Blend | Pimco Realpath vs. Pimco Realpath Blend | Pimco Realpath vs. Pimco Realpath Blend |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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