Correlation Between Citigroup and Rbc Small
Can any of the company-specific risk be diversified away by investing in both Citigroup and Rbc Small 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 Rbc Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Rbc Small Cap, you can compare the effects of market volatilities on Citigroup and Rbc Small 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 Rbc Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Rbc Small.
Diversification Opportunities for Citigroup and Rbc Small
Very good diversification
The 3 months correlation between Citigroup and Rbc is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Rbc Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Small Cap 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 Rbc Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Small Cap has no effect on the direction of Citigroup i.e., Citigroup and Rbc Small go up and down completely randomly.
Pair Corralation between Citigroup and Rbc Small
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.14 times more return on investment than Rbc Small. However, Citigroup is 2.14 times more volatile than Rbc Small Cap. It trades about 0.45 of its potential returns per unit of risk. Rbc Small Cap is currently generating about 0.29 per unit of risk. If you would invest 6,994 in Citigroup on November 2, 2024 and sell it today you would earn a total of 1,192 from holding Citigroup or generate 17.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Citigroup vs. Rbc Small Cap
Performance |
| Timeline |
| Citigroup |
| Rbc Small Cap |
Citigroup and Rbc Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Rbc Small
The main advantage of trading using opposite Citigroup and Rbc Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Rbc Small 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 Rbc Small will offset losses from the drop in Rbc Small's long position.| Citigroup vs. Royal Bank of | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Canadian Imperial Bank |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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