Correlation Between Citigroup and So Carlos
Can any of the company-specific risk be diversified away by investing in both Citigroup and So Carlos 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 So Carlos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and So Carlos Empreendimentos, you can compare the effects of market volatilities on Citigroup and So Carlos 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 So Carlos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and So Carlos.
Diversification Opportunities for Citigroup and So Carlos
Pay attention - limited upside
The 3 months correlation between Citigroup and SCAR3 is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and So Carlos Empreendimentos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on So Carlos Empreendimentos 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 So Carlos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of So Carlos Empreendimentos has no effect on the direction of Citigroup i.e., Citigroup and So Carlos go up and down completely randomly.
Pair Corralation between Citigroup and So Carlos
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.48 times more return on investment than So Carlos. However, Citigroup is 1.48 times more volatile than So Carlos Empreendimentos. It trades about 0.26 of its potential returns per unit of risk. So Carlos Empreendimentos is currently generating about -0.31 per unit of risk. If you would invest 6,361 in Citigroup on September 1, 2024 and sell it today you would earn a total of 726.00 from holding Citigroup or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. So Carlos Empreendimentos
Performance |
| Timeline |
| Citigroup |
| So Carlos Empreendimentos |
Citigroup and So Carlos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and So Carlos
The main advantage of trading using opposite Citigroup and So Carlos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, So Carlos 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 So Carlos will offset losses from the drop in So Carlos' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| So Carlos vs. EZTEC Empreendimentos e | So Carlos vs. PBG SA | So Carlos vs. LPS Brasil | So Carlos vs. Tecnisa SA |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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