Correlation Between Citigroup and TD One
Can any of the company-specific risk be diversified away by investing in both Citigroup and TD One 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 TD One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and TD One Click Aggressive, you can compare the effects of market volatilities on Citigroup and TD One 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 TD One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and TD One.
Diversification Opportunities for Citigroup and TD One
Very poor diversification
The 3 months correlation between Citigroup and TOCA is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and TD One Click Aggressive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TD One Click 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 TD One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TD One Click has no effect on the direction of Citigroup i.e., Citigroup and TD One go up and down completely randomly.
Pair Corralation between Citigroup and TD One
Taking into account the 90-day investment horizon Citigroup is expected to generate 4.3 times more return on investment than TD One. However, Citigroup is 4.3 times more volatile than TD One Click Aggressive. It trades about 0.26 of its potential returns per unit of risk. TD One Click Aggressive is currently generating about 0.41 per unit of risk. If you would invest 6,361 in Citigroup on September 1, 2024 and sell it today you would earn a total of 726.00 from holding Citigroup or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. TD One Click Aggressive
Performance |
| Timeline |
| Citigroup |
| TD One Click |
Citigroup and TD One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and TD One
The main advantage of trading using opposite Citigroup and TD One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, TD One 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 TD One will offset losses from the drop in TD One's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| TD One vs. Brompton Global Dividend | TD One vs. Brompton European Dividend | TD One vs. Brompton North American | TD One vs. Global Healthcare Income |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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