Correlation Between Citigroup and Robo Global
Can any of the company-specific risk be diversified away by investing in both Citigroup and Robo Global 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 Robo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Robo Global Robotics, you can compare the effects of market volatilities on Citigroup and Robo Global 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 Robo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Robo Global.
Diversification Opportunities for Citigroup and Robo Global
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Robo is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Robo Global Robotics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robo Global Robotics 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 Robo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robo Global Robotics has no effect on the direction of Citigroup i.e., Citigroup and Robo Global go up and down completely randomly.
Pair Corralation between Citigroup and Robo Global
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.51 times more return on investment than Robo Global. However, Citigroup is 1.51 times more volatile than Robo Global Robotics. It trades about 0.41 of its potential returns per unit of risk. Robo Global Robotics is currently generating about 0.29 per unit of risk. If you would invest 6,977 in Citigroup on October 24, 2024 and sell it today you would earn a total of 1,022 from holding Citigroup or generate 14.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Robo Global Robotics
Performance |
| Timeline |
| Citigroup |
| Robo Global Robotics |
Citigroup and Robo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Robo Global
The main advantage of trading using opposite Citigroup and Robo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Robo Global 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 Robo Global will offset losses from the drop in Robo Global's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Robo Global vs. Global X Robotics | Robo Global vs. Amplify ETF Trust | Robo Global vs. First Trust Cloud | Robo Global vs. First Trust Nasdaq |
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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