Correlation Between Citigroup and Thachang Green
Can any of the company-specific risk be diversified away by investing in both Citigroup and Thachang Green 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 Thachang Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Thachang Green Energy, you can compare the effects of market volatilities on Citigroup and Thachang Green 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 Thachang Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Thachang Green.
Diversification Opportunities for Citigroup and Thachang Green
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Thachang is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Thachang Green Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thachang Green Energy 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 Thachang Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thachang Green Energy has no effect on the direction of Citigroup i.e., Citigroup and Thachang Green go up and down completely randomly.
Pair Corralation between Citigroup and Thachang Green
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.8 times more return on investment than Thachang Green. However, Citigroup is 1.25 times less risky than Thachang Green. It trades about -0.06 of its potential returns per unit of risk. Thachang Green Energy is currently generating about -0.11 per unit of risk. If you would invest 7,215 in Citigroup on October 7, 2024 and sell it today you would lose (115.00) from holding Citigroup or give up 1.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Citigroup vs. Thachang Green Energy
Performance |
| Timeline |
| Citigroup |
| Thachang Green Energy |
Citigroup and Thachang Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Thachang Green
The main advantage of trading using opposite Citigroup and Thachang Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Thachang Green 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 Thachang Green will offset losses from the drop in Thachang Green's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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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