Correlation Between Citigroup and Shionogi
Can any of the company-specific risk be diversified away by investing in both Citigroup and Shionogi 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 Shionogi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Shionogi Co Ltd, you can compare the effects of market volatilities on Citigroup and Shionogi 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 Shionogi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Shionogi.
Diversification Opportunities for Citigroup and Shionogi
Pay attention - limited upside
The 3 months correlation between Citigroup and Shionogi is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Shionogi Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shionogi 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 Shionogi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shionogi has no effect on the direction of Citigroup i.e., Citigroup and Shionogi go up and down completely randomly.
Pair Corralation between Citigroup and Shionogi
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.81 times more return on investment than Shionogi. However, Citigroup is 1.81 times more volatile than Shionogi Co Ltd. It trades about 0.26 of its potential returns per unit of risk. Shionogi Co Ltd is currently generating about -0.04 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. Shionogi Co Ltd
Performance |
| Timeline |
| Citigroup |
| Shionogi |
Citigroup and Shionogi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Shionogi
The main advantage of trading using opposite Citigroup and Shionogi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Shionogi 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 Shionogi will offset losses from the drop in Shionogi's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Shionogi vs. Holloman Energy Corp | Shionogi vs. cbdMD Inc | Shionogi vs. Evolus Inc | Shionogi vs. CV Sciences |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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