Correlation Between Citigroup and Taiwan Closed
Can any of the company-specific risk be diversified away by investing in both Citigroup and Taiwan Closed 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 Taiwan Closed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Taiwan Closed, you can compare the effects of market volatilities on Citigroup and Taiwan Closed 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 Taiwan Closed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Taiwan Closed.
Diversification Opportunities for Citigroup and Taiwan Closed
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Citigroup and Taiwan is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Taiwan Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiwan Closed 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 Taiwan Closed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiwan Closed has no effect on the direction of Citigroup i.e., Citigroup and Taiwan Closed go up and down completely randomly.
Pair Corralation between Citigroup and Taiwan Closed
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.19 times more return on investment than Taiwan Closed. However, Citigroup is 1.19 times more volatile than Taiwan Closed. It trades about 0.08 of its potential returns per unit of risk. Taiwan Closed is currently generating about 0.08 per unit of risk. If you would invest 4,525 in Citigroup on August 31, 2024 and sell it today you would earn a total of 2,562 from holding Citigroup or generate 56.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Citigroup vs. Taiwan Closed
Performance |
| Timeline |
| Citigroup |
| Taiwan Closed |
Citigroup and Taiwan Closed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Taiwan Closed
The main advantage of trading using opposite Citigroup and Taiwan Closed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Taiwan Closed 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 Taiwan Closed will offset losses from the drop in Taiwan Closed's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Taiwan Closed vs. MFS Investment Grade | Taiwan Closed vs. Eaton Vance Municipal | Taiwan Closed vs. DTF Tax Free | Taiwan Closed vs. HUMANA INC |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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