Correlation Between Citigroup and Stet Tax-advantaged
Can any of the company-specific risk be diversified away by investing in both Citigroup and Stet Tax-advantaged 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 Stet Tax-advantaged into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Stet Tax Advantaged Income, you can compare the effects of market volatilities on Citigroup and Stet Tax-advantaged 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 Stet Tax-advantaged. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Stet Tax-advantaged.
Diversification Opportunities for Citigroup and Stet Tax-advantaged
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Stet is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Stet Tax Advantaged Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stet Tax Advantaged 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 Stet Tax-advantaged. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stet Tax Advantaged has no effect on the direction of Citigroup i.e., Citigroup and Stet Tax-advantaged go up and down completely randomly.
Pair Corralation between Citigroup and Stet Tax-advantaged
Taking into account the 90-day investment horizon Citigroup is expected to generate 6.24 times more return on investment than Stet Tax-advantaged. However, Citigroup is 6.24 times more volatile than Stet Tax Advantaged Income. It trades about 0.08 of its potential returns per unit of risk. Stet Tax Advantaged Income is currently generating about 0.07 per unit of risk. If you would invest 4,746 in Citigroup on November 2, 2024 and sell it today you would earn a total of 3,474 from holding Citigroup or generate 73.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Stet Tax Advantaged Income
Performance |
| Timeline |
| Citigroup |
| Stet Tax Advantaged |
Citigroup and Stet Tax-advantaged Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Stet Tax-advantaged
The main advantage of trading using opposite Citigroup and Stet Tax-advantaged positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Stet Tax-advantaged 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 Stet Tax-advantaged will offset losses from the drop in Stet Tax-advantaged's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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