Correlation Between Citigroup and RJK Explorations
Can any of the company-specific risk be diversified away by investing in both Citigroup and RJK Explorations 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 RJK Explorations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and RJK Explorations, you can compare the effects of market volatilities on Citigroup and RJK Explorations 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 RJK Explorations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and RJK Explorations.
Diversification Opportunities for Citigroup and RJK Explorations
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and RJK is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and RJK Explorations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RJK Explorations 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 RJK Explorations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RJK Explorations has no effect on the direction of Citigroup i.e., Citigroup and RJK Explorations go up and down completely randomly.
Pair Corralation between Citigroup and RJK Explorations
Taking into account the 90-day investment horizon Citigroup is expected to generate 19.95 times less return on investment than RJK Explorations. But when comparing it to its historical volatility, Citigroup is 12.2 times less risky than RJK Explorations. It trades about 0.07 of its potential returns per unit of risk. RJK Explorations is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2.00 in RJK Explorations on September 1, 2024 and sell it today you would earn a total of 3.00 from holding RJK Explorations or generate 150.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Citigroup vs. RJK Explorations
Performance |
| Timeline |
| Citigroup |
| RJK Explorations |
Citigroup and RJK Explorations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and RJK Explorations
The main advantage of trading using opposite Citigroup and RJK Explorations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, RJK Explorations 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 RJK Explorations will offset losses from the drop in RJK Explorations' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| RJK Explorations vs. Haverty Furniture Companies | RJK Explorations vs. KNOT Offshore Partners | RJK Explorations vs. Franklin Street Properties | RJK Explorations vs. Boot Barn Holdings |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |