Correlation Between Citigroup and Schwab Fundamental
Can any of the company-specific risk be diversified away by investing in both Citigroup and Schwab Fundamental 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 Schwab Fundamental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Schwab Fundamental Small, you can compare the effects of market volatilities on Citigroup and Schwab Fundamental 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 Schwab Fundamental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Schwab Fundamental.
Diversification Opportunities for Citigroup and Schwab Fundamental
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Schwab is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Schwab Fundamental Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schwab Fundamental Small 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 Schwab Fundamental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schwab Fundamental Small has no effect on the direction of Citigroup i.e., Citigroup and Schwab Fundamental go up and down completely randomly.
Pair Corralation between Citigroup and Schwab Fundamental
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.41 times more return on investment than Schwab Fundamental. However, Citigroup is 1.41 times more volatile than Schwab Fundamental Small. It trades about 0.12 of its potential returns per unit of risk. Schwab Fundamental Small is currently generating about 0.09 per unit of risk. If you would invest 4,411 in Citigroup on August 25, 2024 and sell it today you would earn a total of 2,573 from holding Citigroup or generate 58.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Schwab Fundamental Small
Performance |
| Timeline |
| Citigroup |
| Schwab Fundamental Small |
Citigroup and Schwab Fundamental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Schwab Fundamental
The main advantage of trading using opposite Citigroup and Schwab Fundamental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Schwab Fundamental 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 Schwab Fundamental will offset losses from the drop in Schwab Fundamental's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Schwab Fundamental vs. Laudus Large Cap | Schwab Fundamental vs. Schwab Target 2010 | Schwab Fundamental vs. Schwab California Tax Free | Schwab Fundamental vs. Schwab Markettrack Servative |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |