Correlation Between Citigroup and Reading International
Can any of the company-specific risk be diversified away by investing in both Citigroup and Reading International 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 Reading International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Reading International, you can compare the effects of market volatilities on Citigroup and Reading International 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 Reading International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Reading International.
Diversification Opportunities for Citigroup and Reading International
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Reading is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Reading International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reading International 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 Reading International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reading International has no effect on the direction of Citigroup i.e., Citigroup and Reading International go up and down completely randomly.
Pair Corralation between Citigroup and Reading International
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.49 times more return on investment than Reading International. However, Citigroup is 2.02 times less risky than Reading International. It trades about 0.21 of its potential returns per unit of risk. Reading International is currently generating about 0.06 per unit of risk. If you would invest 6,393 in Citigroup on August 31, 2024 and sell it today you would earn a total of 623.00 from holding Citigroup or generate 9.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Reading International
Performance |
| Timeline |
| Citigroup |
| Reading International |
Citigroup and Reading International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Reading International
The main advantage of trading using opposite Citigroup and Reading International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Reading International 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 Reading International will offset losses from the drop in Reading International's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Reading International vs. Roku Inc | Reading International vs. AMC Entertainment Holdings | Reading International vs. Paramount Global Class | Reading International vs. Warner Bros Discovery |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |