Correlation Between Citigroup and LEGGETT
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By analyzing existing cross correlation between Citigroup and LEGGETT PLATT INC, you can compare the effects of market volatilities on Citigroup and LEGGETT 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 LEGGETT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and LEGGETT.
Diversification Opportunities for Citigroup and LEGGETT
Excellent diversification
The 3 months correlation between Citigroup and LEGGETT is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and LEGGETT PLATT INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEGGETT PLATT INC 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 LEGGETT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEGGETT PLATT INC has no effect on the direction of Citigroup i.e., Citigroup and LEGGETT go up and down completely randomly.
Pair Corralation between Citigroup and LEGGETT
Taking into account the 90-day investment horizon Citigroup is expected to generate 20.87 times less return on investment than LEGGETT. But when comparing it to its historical volatility, Citigroup is 35.36 times less risky than LEGGETT. It trades about 0.08 of its potential returns per unit of risk. LEGGETT PLATT INC is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 9,282 in LEGGETT PLATT INC on September 1, 2024 and sell it today you would earn a total of 112.00 from holding LEGGETT PLATT INC or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 88.17% |
| Values | Daily Returns |
Citigroup vs. LEGGETT PLATT INC
Performance |
| Timeline |
| Citigroup |
| LEGGETT PLATT INC |
Citigroup and LEGGETT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and LEGGETT
The main advantage of trading using opposite Citigroup and LEGGETT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, LEGGETT 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 LEGGETT will offset losses from the drop in LEGGETT'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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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