Correlation Between Citigroup and New York
Can any of the company-specific risk be diversified away by investing in both Citigroup and New York 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 New York into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and New York Bond, you can compare the effects of market volatilities on Citigroup and New York 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 New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and New York.
Diversification Opportunities for Citigroup and New York
Very good diversification
The 3 months correlation between Citigroup and New is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and New York Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New York Bond 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 New York. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New York Bond has no effect on the direction of Citigroup i.e., Citigroup and New York go up and down completely randomly.
Pair Corralation between Citigroup and New York
Taking into account the 90-day investment horizon Citigroup is expected to generate 4.99 times more return on investment than New York. However, Citigroup is 4.99 times more volatile than New York Bond. It trades about 0.07 of its potential returns per unit of risk. New York Bond is currently generating about 0.07 per unit of risk. If you would invest 4,118 in Citigroup on August 29, 2024 and sell it today you would earn a total of 2,898 from holding Citigroup or generate 70.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. New York Bond
Performance |
| Timeline |
| Citigroup |
| New York Bond |
Citigroup and New York Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and New York
The main advantage of trading using opposite Citigroup and New York positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, New York 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 New York will offset losses from the drop in New York's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| New York vs. Heartland Value Plus | New York vs. Mutual Of America | New York vs. Amg River Road | New York vs. Great West Loomis Sayles |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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