Correlation Between Citigroup and Theta Network
Can any of the company-specific risk be diversified away by investing in both Citigroup and Theta Network 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 Theta Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Theta Network, you can compare the effects of market volatilities on Citigroup and Theta Network 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 Theta Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Theta Network.
Diversification Opportunities for Citigroup and Theta Network
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and Theta is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Theta Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Theta Network 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 Theta Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Theta Network has no effect on the direction of Citigroup i.e., Citigroup and Theta Network go up and down completely randomly.
Pair Corralation between Citigroup and Theta Network
Taking into account the 90-day investment horizon Citigroup is expected to generate 4.58 times less return on investment than Theta Network. But when comparing it to its historical volatility, Citigroup is 2.5 times less risky than Theta Network. It trades about 0.12 of its potential returns per unit of risk. Theta Network is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 113.00 in Theta Network on August 31, 2024 and sell it today you would earn a total of 100.00 from holding Theta Network or generate 88.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Citigroup vs. Theta Network
Performance |
| Timeline |
| Citigroup |
| Theta Network |
Citigroup and Theta Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Theta Network
The main advantage of trading using opposite Citigroup and Theta Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Theta Network 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 Theta Network will offset losses from the drop in Theta Network's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Theta Network vs. Theta Fuel | Theta Network vs. Staked Ether | Theta Network vs. EigenLayer | Theta Network vs. EOSDAC |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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