Correlation Between Citigroup and Hoya Capital
Can any of the company-specific risk be diversified away by investing in both Citigroup and Hoya Capital 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 Hoya Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Hoya Capital High, you can compare the effects of market volatilities on Citigroup and Hoya Capital 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 Hoya Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Hoya Capital.
Diversification Opportunities for Citigroup and Hoya Capital
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Hoya is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Hoya Capital High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoya Capital High 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 Hoya Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoya Capital High has no effect on the direction of Citigroup i.e., Citigroup and Hoya Capital go up and down completely randomly.
Pair Corralation between Citigroup and Hoya Capital
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.52 times more return on investment than Hoya Capital. However, Citigroup is 2.52 times more volatile than Hoya Capital High. It trades about 0.15 of its potential returns per unit of risk. Hoya Capital High is currently generating about -0.05 per unit of risk. If you would invest 6,205 in Citigroup on August 30, 2024 and sell it today you would earn a total of 811.00 from holding Citigroup or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Hoya Capital High
Performance |
| Timeline |
| Citigroup |
| Hoya Capital High |
Citigroup and Hoya Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Hoya Capital
The main advantage of trading using opposite Citigroup and Hoya Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Hoya Capital 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 Hoya Capital will offset losses from the drop in Hoya Capital's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Hoya Capital vs. InfraCap Equity Income | Hoya Capital vs. Virtus InfraCap Preferred | Hoya Capital vs. The Hoya Capital | Hoya Capital vs. Qurate Retail |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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