Correlation Between Citigroup and Thornburg Strategic
Can any of the company-specific risk be diversified away by investing in both Citigroup and Thornburg Strategic 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 Thornburg Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Thornburg Strategic Municipal, you can compare the effects of market volatilities on Citigroup and Thornburg Strategic 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 Thornburg Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Thornburg Strategic.
Diversification Opportunities for Citigroup and Thornburg Strategic
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Citigroup and THORNBURG is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Thornburg Strategic Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg Strategic 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 Thornburg Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg Strategic has no effect on the direction of Citigroup i.e., Citigroup and Thornburg Strategic go up and down completely randomly.
Pair Corralation between Citigroup and Thornburg Strategic
Taking into account the 90-day investment horizon Citigroup is expected to generate 10.02 times more return on investment than Thornburg Strategic. However, Citigroup is 10.02 times more volatile than Thornburg Strategic Municipal. It trades about 0.45 of its potential returns per unit of risk. Thornburg Strategic Municipal is currently generating about 0.06 per unit of risk. If you would invest 6,977 in Citigroup on October 23, 2024 and sell it today you would earn a total of 1,190 from holding Citigroup or generate 17.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Thornburg Strategic Municipal
Performance |
| Timeline |
| Citigroup |
| Thornburg Strategic |
Citigroup and Thornburg Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Thornburg Strategic
The main advantage of trading using opposite Citigroup and Thornburg Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Thornburg Strategic 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 Thornburg Strategic will offset losses from the drop in Thornburg Strategic's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |