Correlation Between Citigroup and Rbc Smid
Can any of the company-specific risk be diversified away by investing in both Citigroup and Rbc Smid 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 Rbc Smid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Rbc Smid Cap, you can compare the effects of market volatilities on Citigroup and Rbc Smid 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 Rbc Smid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Rbc Smid.
Diversification Opportunities for Citigroup and Rbc Smid
Poor diversification
The 3 months correlation between Citigroup and Rbc is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Rbc Smid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Smid Cap 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 Rbc Smid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Smid Cap has no effect on the direction of Citigroup i.e., Citigroup and Rbc Smid go up and down completely randomly.
Pair Corralation between Citigroup and Rbc Smid
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.48 times more return on investment than Rbc Smid. However, Citigroup is 1.48 times more volatile than Rbc Smid Cap. It trades about 0.21 of its potential returns per unit of risk. Rbc Smid Cap is currently generating about 0.16 per unit of risk. If you would invest 6,412 in Citigroup on August 30, 2024 and sell it today you would earn a total of 604.00 from holding Citigroup or generate 9.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Rbc Smid Cap
Performance |
| Timeline |
| Citigroup |
| Rbc Smid Cap |
Citigroup and Rbc Smid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Rbc Smid
The main advantage of trading using opposite Citigroup and Rbc Smid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Rbc Smid 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 Rbc Smid will offset losses from the drop in Rbc Smid's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Rbc Smid vs. Transamerica Emerging Markets | Rbc Smid vs. Versatile Bond Portfolio | Rbc Smid vs. California Bond Fund | Rbc Smid vs. T Rowe Price |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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