Correlation Between Citigroup and Payden Strategic
Can any of the company-specific risk be diversified away by investing in both Citigroup and Payden Strategic 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 Payden Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Payden Strategic Income, you can compare the effects of market volatilities on Citigroup and Payden Strategic 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 Payden Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Payden Strategic.
Diversification Opportunities for Citigroup and Payden Strategic
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Citigroup and Payden is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Payden Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Strategic Income 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 Payden Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Strategic Income has no effect on the direction of Citigroup i.e., Citigroup and Payden Strategic go up and down completely randomly.
Pair Corralation between Citigroup and Payden Strategic
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Payden Strategic. In addition to that, Citigroup is 14.11 times more volatile than Payden Strategic Income. It trades about -0.02 of its total potential returns per unit of risk. Payden Strategic Income is currently generating about 0.38 per unit of volatility. If you would invest 958.00 in Payden Strategic Income on November 27, 2024 and sell it today you would earn a total of 9.00 from holding Payden Strategic Income or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Citigroup vs. Payden Strategic Income
Performance |
| Timeline |
| Citigroup |
| Payden Strategic Income |
Citigroup and Payden Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Payden Strategic
The main advantage of trading using opposite Citigroup and Payden Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Payden Strategic 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 Payden Strategic will offset losses from the drop in Payden Strategic's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Payden Strategic vs. Touchstone Ultra Short | Payden Strategic vs. Barings Active Short | Payden Strategic vs. Buffalo High Yield | Payden Strategic vs. T Rowe Price |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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