Correlation Between Citigroup and Triple Flag
Can any of the company-specific risk be diversified away by investing in both Citigroup and Triple Flag 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 Triple Flag into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Triple Flag Precious, you can compare the effects of market volatilities on Citigroup and Triple Flag 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 Triple Flag. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Triple Flag.
Diversification Opportunities for Citigroup and Triple Flag
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Citigroup and Triple is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Triple Flag Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triple Flag Precious 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 Triple Flag. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triple Flag Precious has no effect on the direction of Citigroup i.e., Citigroup and Triple Flag go up and down completely randomly.
Pair Corralation between Citigroup and Triple Flag
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.98 times more return on investment than Triple Flag. However, Citigroup is 1.03 times less risky than Triple Flag. It trades about 0.07 of its potential returns per unit of risk. Triple Flag Precious is currently generating about 0.07 per unit of risk. If you would invest 4,755 in Citigroup on December 11, 2024 and sell it today you would earn a total of 1,995 from holding Citigroup or generate 41.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.68% |
| Values | Daily Returns |
Citigroup vs. Triple Flag Precious
Performance |
| Timeline |
| Citigroup |
| Triple Flag Precious |
Citigroup and Triple Flag Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Triple Flag
The main advantage of trading using opposite Citigroup and Triple Flag positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Triple Flag 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 Triple Flag will offset losses from the drop in Triple Flag's long position.| Citigroup vs. JPMorgan Chase Co | ||
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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