Correlation Between Citigroup and Simt Us
Can any of the company-specific risk be diversified away by investing in both Citigroup and Simt Us 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 Simt Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Simt Managed Volatility, you can compare the effects of market volatilities on Citigroup and Simt Us 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 Simt Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Simt Us.
Diversification Opportunities for Citigroup and Simt Us
Almost no diversification
The 3 months correlation between Citigroup and Simt is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Simt Managed Volatility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Managed Volatility 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 Simt Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Managed Volatility has no effect on the direction of Citigroup i.e., Citigroup and Simt Us go up and down completely randomly.
Pair Corralation between Citigroup and Simt Us
Taking into account the 90-day investment horizon Citigroup is expected to generate 3.23 times more return on investment than Simt Us. However, Citigroup is 3.23 times more volatile than Simt Managed Volatility. It trades about 0.07 of its potential returns per unit of risk. Simt Managed Volatility is currently generating about 0.2 per unit of risk. If you would invest 6,079 in Citigroup on September 1, 2024 and sell it today you would earn a total of 1,008 from holding Citigroup or generate 16.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.21% |
| Values | Daily Returns |
Citigroup vs. Simt Managed Volatility
Performance |
| Timeline |
| Citigroup |
| Simt Managed Volatility |
Citigroup and Simt Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Simt Us
The main advantage of trading using opposite Citigroup and Simt Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Simt Us 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 Simt Us will offset losses from the drop in Simt Us' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Simt Us vs. Victory Trivalent International | Simt Us vs. Mfs Research Fund | Simt Us vs. The Hartford Midcap | Simt Us vs. Mfs International Growth |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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