Correlation Between Citigroup and Shape Robotics
Can any of the company-specific risk be diversified away by investing in both Citigroup and Shape Robotics 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 Shape Robotics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Shape Robotics AS, you can compare the effects of market volatilities on Citigroup and Shape Robotics 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 Shape Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Shape Robotics.
Diversification Opportunities for Citigroup and Shape Robotics
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Shape is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Shape Robotics AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shape Robotics AS 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 Shape Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shape Robotics AS has no effect on the direction of Citigroup i.e., Citigroup and Shape Robotics go up and down completely randomly.
Pair Corralation between Citigroup and Shape Robotics
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.79 times less return on investment than Shape Robotics. But when comparing it to its historical volatility, Citigroup is 3.59 times less risky than Shape Robotics. It trades about 0.24 of its potential returns per unit of risk. Shape Robotics AS is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,810 in Shape Robotics AS on August 25, 2024 and sell it today you would earn a total of 570.00 from holding Shape Robotics AS or generate 31.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citigroup vs. Shape Robotics AS
Performance |
| Timeline |
| Citigroup |
| Shape Robotics AS |
Citigroup and Shape Robotics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Shape Robotics
The main advantage of trading using opposite Citigroup and Shape Robotics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Shape Robotics 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 Shape Robotics will offset losses from the drop in Shape Robotics' long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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