Correlation Between Citigroup and Rimini Street
Can any of the company-specific risk be diversified away by investing in both Citigroup and Rimini Street 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 Rimini Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Rimini Street, you can compare the effects of market volatilities on Citigroup and Rimini Street 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 Rimini Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Rimini Street.
Diversification Opportunities for Citigroup and Rimini Street
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Rimini is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Rimini Street in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rimini Street 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 Rimini Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rimini Street has no effect on the direction of Citigroup i.e., Citigroup and Rimini Street go up and down completely randomly.
Pair Corralation between Citigroup and Rimini Street
Taking into account the 90-day investment horizon Citigroup is expected to generate 3.21 times less return on investment than Rimini Street. But when comparing it to its historical volatility, Citigroup is 2.84 times less risky than Rimini Street. It trades about 0.22 of its potential returns per unit of risk. Rimini Street is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 282.00 in Rimini Street on November 18, 2024 and sell it today you would earn a total of 60.00 from holding Rimini Street or generate 21.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Rimini Street
Performance |
| Timeline |
| Citigroup |
| Rimini Street |
Citigroup and Rimini Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Rimini Street
The main advantage of trading using opposite Citigroup and Rimini Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Rimini Street 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 Rimini Street will offset losses from the drop in Rimini Street's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Rimini Street vs. Cambium Networks Corp | Rimini Street vs. OneSpan | Rimini Street vs. Kiniksa Pharmaceuticals |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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