Correlation Between Citigroup and Safety Shot
Can any of the company-specific risk be diversified away by investing in both Citigroup and Safety Shot 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 Safety Shot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Safety Shot, you can compare the effects of market volatilities on Citigroup and Safety Shot 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 Safety Shot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Safety Shot.
Diversification Opportunities for Citigroup and Safety Shot
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Safety is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Safety Shot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safety Shot 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 Safety Shot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safety Shot has no effect on the direction of Citigroup i.e., Citigroup and Safety Shot go up and down completely randomly.
Pair Corralation between Citigroup and Safety Shot
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.39 times more return on investment than Safety Shot. However, Citigroup is 2.6 times less risky than Safety Shot. It trades about 0.21 of its potential returns per unit of risk. Safety Shot is currently generating about -0.11 per unit of risk. If you would invest 6,393 in Citigroup on August 31, 2024 and sell it today you would earn a total of 623.00 from holding Citigroup or generate 9.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Safety Shot
Performance |
| Timeline |
| Citigroup |
| Safety Shot |
Citigroup and Safety Shot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Safety Shot
The main advantage of trading using opposite Citigroup and Safety Shot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Safety Shot 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 Safety Shot will offset losses from the drop in Safety Shot's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Safety Shot vs. The Coca Cola | Safety Shot vs. National Beverage Corp | Safety Shot vs. Keurig Dr Pepper | Safety Shot vs. Coca Cola Femsa SAB |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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